Seagate Technology Holdings (STX) has "significant" upside to revenue and earnings-per-share estimates over the next three years, driven by the rollout of heat-assisted magnetic recording, BofA Securities said Monday in a report.
"We believe that Street expectations have not yet accounted for the effect of Seagate's HAMR ramp," BofA said, projecting 2027 EPS of $15 a share as 40-terabyte drives enter volume production.
The Street's current 2026 revenue estimate is almost $1 billion below BofA's analysis, and profitability estimates "are also low," according to the report.
"The Street is underestimating STX's ability to step up profitability with areal density," the firm said.
BofA raised its price objective on Seagate stock to $165 from $145 and maintained its buy rating.
Seagate shares rose 1.5% in recent trading Monday.
Price: 149.36, Change: +2.18, Percent Change: +1.48
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