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Factors to Note Ahead of Seagate's (STX) Q4 Earnings Release
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Seagate Technology Holdings plc (STX - Free Report) is scheduled to report fourth-quarter fiscal 2024 earnings on Jul 23.
The Zacks Consensus Estimate for the earnings is pegged at 75 cents per share. STX reported a loss of 18 cents per share in the prior-year quarter. The consensus estimate for revenues is pegged at $1.86 billion, suggesting an increase of 16.1% from a year ago levels.
Management anticipates fourth-quarter fiscal 2024 revenues to be $1.85 billion (+/- $150 million). Non-GAAP earnings are expected to be 70 cents per share (+/- 20 cents).
STX’s earnings beat the Zacks Consensus Estimate in three of the last four quarters and missed once. The average earnings surprise is 76.4%.
Seagate Technology Holdings PLC Price and EPS Surprise
Management expects incremental improvements in the mass capacity market, especially nearline cloud products and nearline enterprise, and an uptick in demand in VIA markets to have benefited top-line growth in the to-be-reported quarter.
Nearline cloud revenues have been driven by improving sales to cloud customers across the United States and steadying enterprise demand. We expect mass capacity revenues to be up 39.9% year over year to $1,376.7 million.
Secular trends and innovations in driving up aerial density are likely to have spurred mass capacity storage demand. Also, the company is expected to have benefited from an uptake of 24TB PMR / 28TB SMR drives, which began shipping in December 2023.
For legacy and non-HDD markets, Seagate forecasts performance to be at a similar level in the June quarter.
Our estimate for revenues from the HDD segment is pegged at $1,673.7 million, indicating an increase of 20.8% from a year ago. The estimate for the non-HDD (which includes enterprise data solutions, cloud systems and solid-state drives) segment is pegged at $178 million, implying a decrease of 18.4% from the prior-year levels.
Weakness in global macroeconomic conditions, especially a relatively sluggish recovery in China, remains a major concern. IT budget spending is expected to have remained somewhat muted amid a volatile macro backdrop.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Seagate this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. However, this is not the case here.
Seagate has an Earnings ESP of -5.84% and carries a Zacks Rank #2 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some stocks you may consider, as our model shows that these have the right combination of elements to beat on earnings this season.
PM is scheduled to report quarterly earnings on Jul 23. The Zacks Consensus Estimate for PM’s to-be-reported quarter’s EPS and revenues is pegged at $1.55 and $9.13 billion, respectively. Shares of PM have gained 9.5% in the past year.
NextEra Energy Partners, LP (NEP - Free Report) has an Earnings ESP of +8.11% and currently carries a Zacks Rank #2. NEP is scheduled to report quarterly earnings on Jul 24.
The Zacks Consensus Estimate for NEP’s to-be-reported quarter’s EPS and revenues is pegged at 59 cents and $367 million, respectively. Shares of NEP have lost 55% in the past year.
Packaging Corporation of America (PKG - Free Report) has an Earnings ESP of +0.66% and a Zacks Rank #2 at present. PKG is set to report quarterly figures on Jul 23.
The Zacks Consensus Estimate for PKG’s to-be-reported quarter’s EPS and revenues is pegged at $2.12 and $2.03 billion, respectively. Shares of PKG have surged 41.6% in the past year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Factors to Note Ahead of Seagate's (STX) Q4 Earnings Release
Seagate Technology Holdings plc (STX - Free Report) is scheduled to report fourth-quarter fiscal 2024 earnings on Jul 23.
The Zacks Consensus Estimate for the earnings is pegged at 75 cents per share. STX reported a loss of 18 cents per share in the prior-year quarter. The consensus estimate for revenues is pegged at $1.86 billion, suggesting an increase of 16.1% from a year ago levels.
Management anticipates fourth-quarter fiscal 2024 revenues to be $1.85 billion (+/- $150 million). Non-GAAP earnings are expected to be 70 cents per share (+/- 20 cents).
STX’s earnings beat the Zacks Consensus Estimate in three of the last four quarters and missed once. The average earnings surprise is 76.4%.
Seagate Technology Holdings PLC Price and EPS Surprise
Seagate Technology Holdings PLC price-eps-surprise | Seagate Technology Holdings PLC Quote
Factors at Play for Q4
Management expects incremental improvements in the mass capacity market, especially nearline cloud products and nearline enterprise, and an uptick in demand in VIA markets to have benefited top-line growth in the to-be-reported quarter.
Nearline cloud revenues have been driven by improving sales to cloud customers across the United States and steadying enterprise demand. We expect mass capacity revenues to be up 39.9% year over year to $1,376.7 million.
Secular trends and innovations in driving up aerial density are likely to have spurred mass capacity storage demand. Also, the company is expected to have benefited from an uptake of 24TB PMR / 28TB SMR drives, which began shipping in December 2023.
For legacy and non-HDD markets, Seagate forecasts performance to be at a similar level in the June quarter.
Our estimate for revenues from the HDD segment is pegged at $1,673.7 million, indicating an increase of 20.8% from a year ago. The estimate for the non-HDD (which includes enterprise data solutions, cloud systems and solid-state drives) segment is pegged at $178 million, implying a decrease of 18.4% from the prior-year levels.
Weakness in global macroeconomic conditions, especially a relatively sluggish recovery in China, remains a major concern. IT budget spending is expected to have remained somewhat muted amid a volatile macro backdrop.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Seagate this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. However, this is not the case here.
Seagate has an Earnings ESP of -5.84% and carries a Zacks Rank #2 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some stocks you may consider, as our model shows that these have the right combination of elements to beat on earnings this season.
Philip Morris International Inc. (PM - Free Report) has an Earnings ESP of +1.42% and currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
PM is scheduled to report quarterly earnings on Jul 23. The Zacks Consensus Estimate for PM’s to-be-reported quarter’s EPS and revenues is pegged at $1.55 and $9.13 billion, respectively. Shares of PM have gained 9.5% in the past year.
NextEra Energy Partners, LP (NEP - Free Report) has an Earnings ESP of +8.11% and currently carries a Zacks Rank #2. NEP is scheduled to report quarterly earnings on Jul 24.
The Zacks Consensus Estimate for NEP’s to-be-reported quarter’s EPS and revenues is pegged at 59 cents and $367 million, respectively. Shares of NEP have lost 55% in the past year.
Packaging Corporation of America (PKG - Free Report) has an Earnings ESP of +0.66% and a Zacks Rank #2 at present. PKG is set to report quarterly figures on Jul 23.
The Zacks Consensus Estimate for PKG’s to-be-reported quarter’s EPS and revenues is pegged at $2.12 and $2.03 billion, respectively. Shares of PKG have surged 41.6% in the past year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.