In this video, Motley Fool analysts Jim Mueller and Andrew Tonner discuss the risks associated with Seagate Technology (NASDAQ:STX).

Jim first tells us that one of the risks is related to stock-based compensation. Seagate's goal is to reduce its share count over the next two years from 400 million to 250 million.

The second problem Jim focuses on is price erosion. Consumers expect product prices to fall as costs decrease, but as one of the dominant names in its industry, it does have some power to slow down the price drops.

Finally, Jim focuses on the threat to Seagate from the latest solid-state drive technology. It represents a very small part of the market and is relatively expensive, but it does have advantages, and Seagate needs to keep an eye on any unfolding trends.

Andrew Tonner has no positions in the stocks mentioned above. Jim Mueller owns shares of and Western Digital and has long JAN 2014 $20 calls on Facebook. The Motley Fool owns shares of, Facebook, Fusion-io, and Western Digital and has the long JAN 2014 $20.00 calls on Facebook. Motley Fool newsletter services recommend and Facebook. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.