14:55 T =Disk-Drive Stks -2: Quantum Leads Group, Reaches 52-Wk High
NEW YORK (Dow Jones)--Bucking declines in the broader market, shares of
disk-drive makers rose sharply Wednesday on the back of stellar quarterly
earnings from industry standout Seagate Technology Inc. (SEG).
"Seagate had a great quarter, so naturally that excites everyone,"
NationsBanc Montgomery Securities Inc. analyst Paul Fox said.
Aside from beating Wall Street's fiscal second-quarter earnings estimates by
16 cents a share, Seagate nourished investor confidence in the disk-drive
industry by saying demand for its products remains relatively robust as it
moves into 1999, Gruntal & Co. analyst David Takata said.
That is uncommonly good news because after sapping their wallets during the
holiday season, both consumers and corporations buy fewer computers in the
first quarter of the new year. Disk-drive makers, therefore, usually report a
decline in earnings from the year-end quarter to the first quarter of the new
year.
But Seagate, flying in the face of that tradition, forecast flat to modest
earnings growth for its first period of 1999. By contrast, "flatness is
normally a good thing, and negative is acceptable," for that period, Takata
said.
Among disk-drive advancers Wednesday, Quantum Corp. (QNTM) led the way,
gaining 2 15/16, or 11.4%, to 28 3/4, eclipsing its 52-week high of 26 13/16,
set Feb. 17. The shares rose to an intraday high of 28 7/8 earlier.
Meanwhile, Western Digital Corp. (WDC) rose 1 3/4, or 9%, to 21 1/4, and
Maxtor Corp. (MXTR) jumped 1 3/4, or 10.3%, to 18 11/16.
(MORE) DOW JONES NEWS 01-13-99
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