In the video below, Motley Fool Stock Advisor analyst Jim Mueller takes a look at the investment thesis for Seagate Technology (NASDAQ: STX ) . Jim notes that Seagate and competitor Western Digital (NASDAQ: WDC ) control 87% of the market share for hard disk drives. This control over the market provides significant pricing power that helps to minimize the erosion of prices resulting from Moore's Law of constantly decreasing pricing for computer components.
Additionally, Jim notes that the overall hard disk market is poised for growth. This growth is not necessarily occurring in the PC market, but rather in the expansion of cloud storage and enterprise IT demand. Jim notes that PCs are getting replaced by tablets and smartphones, but the backend of this mobile revolution is a significant demand for storage of everything from websites to content on popular social media sites such as Facebook (NASDAQ: FB ) .
Based on the ability to maintain pricing and the growth in demand for data storage, Jim contends that Seagate warrants attention as an investment candidate despite the "death of the PC" news headlines.
While Seagate Technology pays a significant and growing dividend and seems able to generate the cash flow to support it, a global slowdown in demand for digital memory storage has begun to put pressure on margins. Is Seagate worthy of your investment dollars? Jim answers this question and more in our most in-depth Seagate research available for smart investors like you. Thousands have already claimed their own premium ticker coverage, and you can gain instant access to your own by clicking here now.