3 Reasons It Could Be Time to Sell Seagate

In the video below, Motley Fool analysts Andrew Tonner and Jim Mueller discuss three reasons why it could be time to sell Seagate Technology (NASDAQ: STX  ) .

The first issue Jim sees is how generous the company is in its options and its stock-based compensation plan. Option dilution is significant with this company, and It spends a lot of cash flow keeping that in check and reducing its share count.

Second, there seems to be a global slowdown in demand for storage space with PCs, and even the cloud storage spaces have downward pressure. This has lead to a lot of short-term pressures.

The third potential reason to sell Seagate is the rise of solid-state drives. Hard disk technology is still very cheap, but solid state drives are getting very good. If Seagate can get into SSDs, this could create more upside for the company. 

Though Seagate pays a significant dividend and has the cash flow to support it, the demand for digital memory has put pressure on margins. Is Seagate worthy of your investment dollars? The Motley Fool answers this question and more in our most in-depth Seagate research available for smart investors like you. You, like thousands of others, can gain instant access to your own premium ticker report by clicking here now.


Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2165929, ~/Articles/ArticleHandler.aspx, 8/28/2014 7:37:27 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 10 hours ago Sponsored by:
DOW 17,122.01 15.31 0.09%
S&P 500 2,000.12 0.10 0.00%
NASD 4,569.62 -1.02 -0.02%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/27/2014 3:59 PM
STX $61.18 Up +0.52 +0.86%
Seagate Technology CAPS Rating: ***
AMZN $343.18 Up +1.35 +0.39%
Amazon.com CAPS Rating: ***
FB $74.63 Down -1.33 -1.75%
Facebook CAPS Rating: **
FIO $0.00 Down +0.00 +0.00%
Fusion-io, Inc. CAPS Rating: ***
WDC $102.71 Up +0.76 +0.75%
Western Digital Co… CAPS Rating: ****

Advertisement