SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

   Technology StocksWestern Digital (WDC)


Previous 10 Next 10 
To: Sam Citron who wrote (11004)6/14/2005 10:47:05 AM
From: Mark O. Halverson
   of 11057
 
Rather a big hit on WDC today, especially inasmuch as yesterday the company forcast increased revenues. I assume hit totally due to Piper cutting WDC to market perform. Other factors, do you think?

Best,
Mark

Share RecommendKeepReplyMark as Last ReadRead Replies (2)


To: Mark O. Halverson who wrote (11005)6/14/2005 12:59:46 PM
From: Sam Citron
   of 11057
 
Indeed. Looks similar to reaction to Merrill report 2 weeks ago. I haven't read the report yet so can not really comment. I sold my WDC position recently Message 21342815
and have also been out of town, so am in catch-up mode.

Sam

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: Sam Citron who wrote (11006)9/8/2005 9:54:36 PM
From: sixty2nds
   of 11057
 
14:06 WDC Western Digital on conference call (13.98 -0.40)

Co, speaking at Citigroup's 12th Annual Global Technology Conference, is very bullish on one inch disk drives in consumer markets; says this product platform is key for its future technologies; co feels pretty good about its position in the marketplace. Co says it is making investments into new hard drive technologies at a time when competitors are cutting back; co sees substantial unit growth by 2008; co stresses that it will enter into new markets and notes it has no debt and solid financials (two variables that should help them to succeed). Co said it would be great to use aluminum in notebooks b/c it is cheaper than glass, but says it has been talked about for years and its still being tried out.

Share RecommendKeepReplyMark as Last Read


To: Mark O. Halverson who wrote (11005)9/15/2005 12:12:00 PM
From: Mark O. Halverson
   of 11057
 
Hard drive versus flash: Having watched my drive stocks bleed considerably as of late, I found the below Baron's piece (via Yahoo) very interesting. Medium term, it appears that there's reason for some optimism. Very long term, who knows? Any comments on hard drive versus flash?

yahoo.smartmoney.com

Best,
Mark

Share RecommendKeepReplyMark as Last Read


From: Sam Citron10/10/2005 12:19:22 PM
   of 11057
 
Maxtor's Big Recovery [Barrons 10.10.05]
By JAY PALMER

"WARNING: WINDOWS HAS BEEN SHUT DOWN to avoid damage -- system file corrupt."

When that dreaded blue-screen message pops up on a computer, it threatens the loss of years' worth of often-irreplaceable photographs, documents and other data. The cause could be a drive failure, program glitches or a virus. And the problem is altogether too common: Some 44% of American adults have lost data in major personal-computer failures, according to a recent Harris poll.

That's why Maxtor's OneTouch II is flying off the shelves. The size of a hardback book, this external hard drive sits on the desk backing up as much or as little of your computer's own stored data as you want at the touch of a button. It also gives a glimpse of how Maxtor (ticker: MXO) could start standing out from the pack in the cut-throat market for the disk drives.

Like rivals Seagate Technology and Western Digital, Maxtor sells disk drives -- which store data by spinning small disks at high speeds -- to computer makers. But it also has a small but promising consumer electronics division, home of the OneTouch II. Though this division now chips in just 5% of the company's revenue, executives expect its sales to grow by 30% a year through 2010, versus 10% or so for the rest of the business, thanks to the heavy data-storage needs of digital video recorders, game boxes, global positioning devices and more.


The rise of the consumer unit underscores a dramatic turnaround at the Milpitas, Calif.-based firm. If the company continues to implement its plans successfully, bulls maintain, the shares, recently at 4, could easily rise by 50% and possibly much more.

The basic problem for Maxtor has been the ongoing commoditization of the hard-drive market and the distressingly frequent price wars that have cut prices by an average of over 16% year since the mid-'Nineties -- faster than the 14% annual decline in costs. Maxtor, hungry to win market share and drive up volume, helped initiate the latest and biggest round of price-cutting in 2003 and 2004, effectively wiping out the entire industry's profitability.

The company's former bosses, especially CEO Paul Tufano, blundered on other accounts too. Millions were spent to develop a new 2.5-inch aluminum hard drive (most are glass and more costly), only for Maxtor to cancel the project when rivals came out with better, higher-capacity units faster than expected. Perhaps worst of all, Maxtor let its quality controls slip, resulting in sharply reduced orders from some of its big customers, including Dell. Result: Maxtor lost $181 million last year, compared with a 2003 profit of $102.7 million.


Even before those numbers came out, Tufano was ousted. He was replaced as the company's day-to-day leader by Mike Wingert, a former Maxtor executive who had left to head a data-storage startup.

"I saw real potential in the company when I returned," says Wingert, now president. "The problems were not the market but Maxtor. We had lost markets, leadership and reputation. We were master chefs who had lost our recipe."

Wingert, 45, already is getting results. Maxtor posted a profit in the April-June quarter of this year, earlier than nearly all Street analysts had expected. That came from big improvement in the company's enterprise operation, which sells high-end storage devices to big corporations; Maxtor had brought previously outsourced manufacturing in-house, boosting margins. For the third quarter and the year as a whole, estimates vary from small losses to modest profits, but 2006 is likely to bring profits in all four quarters. Analysts expect 25 cents to 46 cents per share for all of next year, though that range could be low.

Table: Storing Up ValueThe biggest uncertainty -- and the biggest potential -- lies in desktop computers, where Maxtor earns 80% of its sales and serves makers like Dell, Hewlett-Packard, Gateway, Apple and IBM/Lenovo. Here, sales increases are driven by two factors, the first being technological advances in speed or capacity. On that score, Maxtor is highly competitive and intends to remain so.

Then there's quality. "We have rationalized our product and eliminated all the quality issues," says Wingert. But, he acknowledges, it will take time to restore the company's reputation and return the business to its previous market share. This side of Maxtor probably won't return to full glory before the end of 2006.

EVEN SO, MAXTOR STOCK LOOKS ATTRACTIVE as a recovery play. Yes, it carries a higher price-earnings multiple than shares of rival disk makers -- 15.3 times '06 earnings estimates. But it's more enticing based on its enterprise value-to-sales ratio -- Maxtor's is just 0.28, about one-third of Seagate's -- and analysts often favor that measure in sizing up unprofitable drive makers. (Enterprise value equals equity plus net debt.)

THE BOTTOM LINE


Maxtor is headed firmly into the black for '06, and its consumer division is on track to post sales growth of 30% annually for several years. Shares could easily climb 50% in a year."My price target for the short-term is 6," says analyst Rich Kugele who follows the industry for brokerage firm Needham & Co. If Maxtor merely matches the industry's enterprise value-to-sales multiple, he points out, the stock could triple or even quadruple.

But that's not going to happen until investors become happier about the industry as a whole. Though there are no signs of suicidal price wars now, hardly a month goes by without a Street analyst cautioning that one may be at hand. Moreover, though the mini hard-drives sold into Apple's original iPod never accounted for much of the industry's sales, news that the new iPod nano uses flash memory has raised concern about disk-drive obsolescence. But current flash drives are unsuitable for PCs.

The hard-drive industry, meanwhile, does have some clear trends going its favor. With high-definition TV coming of age, consumers will need bigger and bigger drives for video recorders like TiVos. Says Wingert: "There has never been a better timer to be in the hard-drive business." Maxtor investors might come to agree.

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: Sam Citron who wrote (11009)12/21/2005 7:26:18 AM
From: sixty2nds
   of 11057
 
04:53 STX Seagate Tech reaches $1.9 bln deal to buy rival Maxtor - WSJ (19.60 )

According to the Wall Street Journal, Seagate Technology (STX) has agreed to pay $1.9 bln in stock to buy rival Maxtor (MXO, 4.52), people familiar with the matter said. Under the deal, expected to be announced today, Seagate plans to swap 0.37 of a Seagate share for each share of Maxtor, these people said. Boards of the two companies yesterday approved the transaction, which must be approved by shareholders of both companies, they added. The exchange ratio indicates a current value to Maxtor holders of about $7.25 a share, a 60% premium above yesterday's closing price of Maxtor shares.

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: sixty2nds who wrote (11010)1/5/2006 9:17:12 PM
From: Gottfried
   of 11057
 
"Samsung's solid-state disks will be puny, pricey, and impractical" from January IEEE Spectrum
spectrum.ieee.org

Share RecommendKeepReplyMark as Last Read


From: rlev1/9/2006 1:30:51 PM
   of 11057
 
Western Digital looking good on Relative Strength: hit a multi year high of 21.55 +1.55 ... breaking thur its 1/13/1999 peak of 21.44. The all time high was around $54 in Aug of 1997.

I'm hoping to break that all time peak in 06. Optimistic? Probably.

-- Rich

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: rlev who wrote (11012)3/19/2006 9:47:11 PM
From: JCMcClain28
   of 11057
 
What products are Western Digital coming out with in 06?

Might be an indicator either way?

Share RecommendKeepReplyMark as Last Read


From: Carey Thompson11/14/2006 4:58:18 PM
   of 11057
 
WD ANNOUNCES Q1 REVENUE OF $1.3 BILLION AND NET INCOME OF $.46 PER SHARE

--------------------------------------------------------------------------------

Strong Year-Over-Year Growth Achieved in All Key Metrics

LAKE FOREST, Calif. - Nov. 2, 2006 - Western Digital Corp. (NYSE: WDC) today reported revenue of $1.3 billion on shipments of approximately 22.7 million units, and net income of $103 million, or $.46 per share for its first fiscal quarter ended Sept. 29, 2006. Included in the unit shipments were approximately 2.2 million 2.5-inch mobile hard drives and approximately 2.5 million 3.5-inch hard drives for utilization in personal and digital video recorders-both fast-growing, newer markets for the company.

In a separate news release today, the company announced that president and chief operating officer John Coyne will become chief executive officer on Jan. 2, 2007 and that current chief executive officer Arif Shakeel will remain with the company through June 29, 2007 as a full-time advisor and will stand for re-election to the board of directors at the next annual meeting. Coyne has joined the board and will also stand for re-election.

The first quarter results represented strong year-over-year performance, including 33 percent unit growth, 25 percent growth in revenue versus $1.0 billion in the year-ago period and 49 percent growth in net income over the $69 million reported last year. A year ago, the company reported earnings of $.31 per share in the fiscal first quarter and shipped 17.1 million units.

WD indicated that 35 percent of its Q1 revenue was derived from non-desktop PC sources including notebook PCs, consumer electronics, enterprise applications, and retail sales. Sixty-five percent of the company's first quarter revenue came from hard drives configured into desktop PCs, a market that remains strong. This compares with a mix in the year-ago quarter of 25 percent non-desktop PC revenue, 75 percent desktop PC revenue.

From a balance sheet perspective, the company generated $128 million in cash from operations during the September quarter, ending with total cash and short-term investments of $751 million.

Arif Shakeel, chief executive officer of WD, said, "Several years ago we identified expansion into new markets as a major long-term goal of the company. We have achieved this off the base of a highly-successful desktop hard drive business and an efficient and leveraged business model. Our Q1 results reflect the ongoing success of this diversification effort and a continuation of our consistent financial performance. As we address multiple growth opportunities in the years ahead, we will continue our emphasis on excellence in operations, including a relentless focus on customer satisfaction and the reliability and quality of our products."

The company's operating results reflected in this release do not include any adjustment relating to the findings of the Special Committee, previously announced on Oct. 23, 2006, with respect to its review of the company's historical stock option grants. Based on the review, it has been preliminarily determined that the company should have recognized approximately $21 million of additional stock-based compensation and tax-related expenses in its historical financial statements. However, the company does not anticipate a material adjustment to the operating results included in this release nor to the results for fiscal 2005 and 2006 included in its July 27, 2006 press release.

The investment community conference call to discuss these results and the company's outlook will be broadcast live over the Internet today at 2 p.m. PST/5 p.m. EST. The call will be accessible live and on an archived basis via the link below:

Audio Webcast: www.westerndigital.com/investor -- click on "Conference Calls"

Telephone Replay: 866-385-0197 (toll-free) or +1-203-369-0394 (international)

Share RecommendKeepReplyMark as Last Read
Previous 10 Next 10