Seagate Technology: 3 Reasons to Buy Now

With aims for big reductions in outstanding shares and an ever-growing dividend, investors need to give Seagate a look.

Jim Mueller, CFA
Jim Mueller, CFA and Andrew Tonner
Dec 24, 2012 at 2:00PM
Technology and Telecom

In this video, Motley Fool analyst Jim Mueller discusses three reasons to buy Seagate (NASDAQ:STX) today.

First, the company has decided on a goal to drop down the number of shares outstanding from about 400 million to 250 million by 2014. This would mean that the shares owned by the shareholders would be worth a lot more when the share count falls.

Seagate also pays a growing dividend and the yield currently sits around 5.5% which is quite significant.

Finally, there is a long-term growth trend for hard drives and companies with cloud-based services, including Amazon (NASDAQ:AMZN), need to buy hard drives for storage. There is stability in this market, along with other growth areas, so Seagate will be around for quite a long time.