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Summit Research initiated coverage of Western Digital ( WDC ) with a buy rating, saying that the company’s market position improved following its $16 billion acquisition of SanDisk ( SNDK ) this month. Summit Research analyst Srini Sundararajan set a price target on Western Digital of 74. Western Digital stock was near 46, down a fraction, in afternoon trading in the stock market today and just above its 50-day moving average. Western Digital is the largest supplier of disk drives, followed closely by Seagate Technology ( STX ). Western Digital holds a 44% share of the disk drive market, with Seagate at 40%. Western Digital shareholders approved the deal to acquire SanDisk early this month, creating a company that is a formidable competitor in both disk drives and flash-chip storage. SanDisk is a leading provider of chips used for data storage in a wide variety of devices, including smartphones, tablets and PCs. The acquisition is expected to double Western Digital’s addressable market from to $75 billion from $37 billion. Sundararajan, in a research report, said that SanDisk, which has a strong retail business, will be able to move up the ladder in the enterprise market, where Western Digital is strongest. Western Digital, meanwhile, gets the ability to offer chip-based storage in areas where its disk drive technology is losing ground. The combined company will have annual revenue of nearly $20 billion, vs. $13.7 billion for Seagate. Image provided by Shutterstock . Scalper1 News
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