- A Nikkei Asia report that Toshiba will invest roughly 60 billion yen ($380 million) to nearly double HDD production capacity in the Philippines by fiscal 2027 triggered a 10.2% Friday selloff in Western Digital and a drop in Seagate.
- Bernstein called the reaction a "storm in a teacup," calculating that Toshiba's exabyte share rises only from 11.2% to 16.8% if WDC and STX each grow shipments 25%, well below the 30% share cited in press reports.
- Morgan Stanley analyst Erik Woodring said Toshiba's nearline capacity expansion equals about 30% annual growth over two years, is consistent with broader industry expansion, and has limited impact on overall capacity or pricing.
- Citi said the industry is under-shipping unconstrained demand by a wide margin and recommended buying WDC and STX after the selloff, while Morgan Stanley called the move a knee-jerk reaction.
- Goldman Sachs named Seagate a top tactical pick but rated Western Digital Neutral, expecting the latter to underperform despite leading the rebound with a 7% gain.
- The rally was confined to HDD makers; flash storage maker SanDisk and the broader Roundhill Memory ETF barely moved.
- Retail sentiment on Stocktwits flipped to bullish on both WDC and STX over the weekend ahead of Monday's session.
Quotes
“Toshiba is unlikely to reach the reported 30% HDD market share”
“storm in a teacup”
“the industry is currently under-shipping unconstrained demand”
“HDD supply is expected to remain tight through 2028”
“knee-jerk reaction”
Sources
- Seagate and Western Digital Stocks Rebound as Morgan Stanley Says Get AggressiveTipranks
- Western Digital Jumps 7%, Seagate Climbs 5% as Bernstein Calls Toshiba Selloff a Storm in a Teacup; SanDisk Inches Higher
- WDC, STX Stocks Rebound Premarket As Analysts Downplay Toshiba Capacity Expansion FearsStocktwits