Has Western Digital Become the Perfect Stock?http://www.fool.com/investing/general/2012/09/07/has-western-digital-become-the-perfect-stock.aspx Dan Caplinger
September 7, 2012
Every investor would love to stumble upon the perfect stock. But will you ever really find a stock that provides everything you could possibly want?
One thing's for sure: You'll never discover truly great investments unless you actively look for them. Let's discuss the ideal qualities of a perfect stock, then decide if Western Digital (Nasdaq: WDC ) fits the bill.
The quest for perfection
With those factors in mind, let's take a closer look at Western Digital.
Source: S&P Capital IQ. Total score = number of passes.
Since we looked at Western Digital last year, the company has picked up two points. The stock has done even better, rising more than 50% over the past year.
Western Digital has been through a lot in the last year. Last fall, the company suffered greatly as flooding in Thailand caused severe damage to its production facilities. By contrast, rival Seagate Technology (Nasdaq: STX ) wasn't hit nearly as hard, giving it a major competitive advantage over Western Digital.
Yet even though it took several quarters for Western Digital to catch up, it managed to bounce back a lot faster than many had thought. As early as January, Western Digital benefited from substantially higher prices from the much-reduced supply of hard drives, making up for production cuts and actually improving gross profits. The completion of its acquisition of Hitachi in March also eliminated a competitor.
Rising hard-drive prices,