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Stock Market & Financial Investment News

News For WDC;STX From The Last 14 Days
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January 28, 2016
17:12 EDTWDCWestern Digital says 'pleased with progress' on SanDisk acquisition
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17:06 EDTWDCWestern Digital says expects weak demand in Q3
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16:18 EDTWDCWestern Digital reports Q2 free cash flow $449M
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16:17 EDTWDCWestern Digital reports Q2 adjusted gross margin 28.5%
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16:16 EDTWDCWestern Digital reports Q2 adjusted EPS $1.60, consensus $1.54
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15:19 EDTSTX, WDCEarnings Watch: Hard drive makers report with analysts upbeat on SanDisk deal
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14:29 EDTSTXNotable companies reporting before tomorrow's open
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14:29 EDTWDCNotable companies reporting after market close
Notable companies reporting after the market close, with earnings consensus, include Microsoft (MSFT), consensus 71c... Amazon (AMZN), consensus $1.56... Amgen (AMGN), consensus $2.29... Electronic Arts (EA), consensus $1.81... Skyworks (SWKS), consensus $1.58... Western Digital (WDC), consensus $1.54... Visa (V), consensus 68c... Flextronics (FLEX), consensus 31c... NetSuite (N), consensus 4c... Fortinet (FTNT), consensus 18c... Synaptics (SYNA), consensus $1.58... Proofpoint (PFPT), consensus (11c).
07:37 EDTSTXSeagate volatility elevated into Q4 and outlook
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January 27, 2016
15:10 EDTSTX, WDCEarnings Watch: Western Digital deal update focus of SanDisk report
SanDisk (SNDK) is expected to report fourth quarter earnings after the close on Wednesday, January 27. SanDisk will not hold a conference call to discuss its financial results in light of the pending acquisition by Western Digital (WDC). SanDisk manufactures data storage solutions, including removable and embedded Flash memory and solid-state drives. EXPECTATIONS: Analysts are looking for earnings per share of 89c on revenue of $1.44B. The consensus range is 83c-$1.00 for EPS on revenue of $1.4B-$1.47B, according to First Call. Along with its last earnings report, SanDisk guided to Q4 revenue of $1.4B-$1.475B and a non-GAAP gross margin 40%-43%. LAST QUARTER: On October 21, SanDisk reported third quarter earnings per share of $1.09 and revenue of $1.45B, compared to expectations of 80c and $1.4B, respectively. NEWS: Along with releasing its earnings report, SanDisk announced a definitive agreement under which Western Digital will acquire all of the outstanding shares of SanDisk for a combination of cash and stock that values SanDisk common stock at $86.50 per share, or a total equity value of approximately $19B. If the investment in Western Digital by Unisplendour Corporation closes prior to this acquisition, Western Digital will pay $85.10 per share in cash and 0.0176 shares of Western Digital common stock per share of SanDisk common stock; and if the Unisplendour transaction has not closed or has been terminated, $67.50 in cash and 0.2387 shares of Western Digital common stock per share of SanDisk common stock. The companies said at the time that the transaction is expected to close in the third quarter of 2016. STREET RESEARCH: On December 28, Brean Capital analyst Ananda Baruah said the combined Western Digital-SanDisk company, post an expected merger close in September of this year, can generate FY17 earnings per share of $13-$15. He kept a $150 standalone Western Digital target price and believes that the combined company's shares should trade in a range of $154-$256 post close. On January 6, Pacific Crest analyst Monika Garg called Western Digital her best idea for 2016, stating that the company's pending acquisition of SanDisk "would create a formidable company" and bring significant earnings and cash flow generation. On January 25, CLSA analyst Mark Heller downgraded SanDisk to Underperform due to weakening NAND fundamentals and higher deal risk. The analyst does not believe Western Digital can walk away from the deal due to weakening fundamentals, but is more cautious on Unisplenour's investment in Western Digital. Heller lowered his price target to $70 from $86 on SanDisk shares. The same day, Jefferies analyst James Kisner lowered his estimates for Western Digital and Seagate (STX), citing the weak results and guidance from Nidec and a more conservative approach following the recent selloff in the shares. Western Digital's current valuation fully prices in an "extreme bear case" for the combined Western Digital and SanDisk, Kisner told investors in his research note. The analyst cut his price target for Western Digital to $82 from $95 but kept a Buy rating on the stock. Noting that the Committee on Foreign Investment in the United States would not grant regulatory clearance for Philips (PHG) to sell an 80.1% interest in Lumileds to China's GO Scale Capital, Summit Research analyst Srini Sundararajan said on January 26 that he thinks that the Unisplendour investment in Western Digital is more than likely to be stalled, if not blocked, given the current political climate. However, he also believes Western Digital planned for this contingency and that its deal with SanDisk should still go through. This morning, Citi analyst Stanley Kovler initiated coverage of Western Digital with a Buy rating, as the firm is relatively bullish on the company's acquisition of SanDisk. Conversely, Citi started coverage of Seagate (STX) with a Sell rating, saying that actions it has taken to cope with the decline of the sector "may only help so much." Kovler set an $82 price target on SanDisk, a $53 price target on Western Digital and a $23 price target on Seagate. PRICE ACTION: In afternoon trading, SanDisk rose 0.75% to $64.57 per share. Since October 21, shares of SanDisk have declined about 14%. Since that same day, Western Digital shares are down over 41%.
11:13 EDTSTX, WDCCiti mixed on hard disk drive makers, says sell Seagate, buy Western Digital
Citi initiated coverage of hard disk drive, or HDD, maker Western Digital (WDC) with a Buy rating, as the firm is relatively bullish on the company's acquisition of flash memory developer SanDisk (SNDK). Conversely, Citi started coverage of the other major hard disk drive maker, Seagate (STX), with a Sell rating, saying that actions it has taken to cope with the decline of the sector "may only help so much." Stating that the sector has begun a decline that should last for quite some time, the firm believes that Western Digital's actions to cope with this situation are more effective than those taken by its competitor. WHAT'S NEW: Western Digital's pending acquisition of SanDisk makes the company more stable, and will raise its margins and profits, according to Citi analyst Stanley Kovler. The deal will increase Western Digital's earnings per share by a greater amount than if the company had continued its shares buybacks, the analyst added. Conversely, Seagate is trying to lower its costs and improve its products and execution, Kovler noted. The company also entered the solid state drive market, he stated. Given Seagate's limited exposure to markets other than HDD and the "malaise" in that market, the company may seek to make a "potentially transformative" acquisition, the analyst stated. But in light of its "limited financial flexibility," such a deal could limit its ability to return cash to shareholders, Kovler warned. Moreover, any acquisition made by the company may not be large enough to "fully transform" Seagate, according to Kovler, who set a $53 price target on Western Digital and a $23 price target on Seagate. PRICE ACTION: In late morning trading, Western Digital fell 1% to $44.83 and Seagate lost 1.6% to $27.29.
10:00 EDTWDCOn The Fly: Analyst Initiation Summary
Today's noteworthy initiations include: Arista Networks (ANET) initiated with a Buy at Citi... Brocade (BRCD) initiated with a Neutral at Citi... CBL & Associates (CBL) initiated with an Underperform at Boenning & Scattergood... Caleres (CAL) initiated with a Hold at BB&T... Ciena (CIEN) initiated with a Neutral at Citi... Fitbit (FIT) initiated with a Buy, $35 target at Citi... Genesco (GCO) initiated with a Hold at BB&T... Infinera (INFN) initiated with a Buy at Citi... Nabriva Therapeutics (NBRV) initiated with a Buy at Gabelli... SanDisk (SNDK) initiated with a Buy at Citi... Seagate (STX) initiated with a Sell at Citi... Tanger Factory (SKT) initiated with an Underperform at Boenning & Scattergood... Taubman Centers (TCO) initiated with a Neutral at Boenning & Scattergood... WP Glimcher (WPG) initiated with an Underperform at Boenning & Scattergood... Western Digital (WDC) initiated with a Buy at Citi... Yirendai (YRD) initiated with a Buy at Needham.
06:41 EDTWDC, STXSeagate initiated with a Sell at Citi
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06:38 EDTWDCWestern Digital initiated with a Buy at Citi
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January 26, 2016
15:59 EDTWDCUnisplendour has financing for Western Digital-SanDisk deal, dealReporter says
11:42 EDTWDCOptions with increasing call volume; TEX MTW MTG SEE KBH SNDK WDC VALE VIAB PII
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09:30 EDTWDCWestern Digital, SanDisk deal should go through, Summit Research says
Summit Research analyst Srini Sundararajan said he thinks that the Unisplendour investment in Western Digital (WDC) is more than likely to be stalled, if not blocked, given the current political climate, but he also believes Western Digital planned for this contingency and that its deal with SanDisk (SNDK) should still go through. Additionally, Sundararajan said he believes CFIUS stepping in to block Philips' (PHG) sale of its Lumileds LED and automotive lighting unit to GO Scale Capital is a positive development for Cree (CREE), which should be pleased that a "flood the market" Chinese competitor has not been given the green light.
January 25, 2016
08:11 EDTWDCWestern Digital acquires over a hundred patents from IBM
Western Digital (WDC) announced that it has acquired more than 100 patent assets from IBM (IBM). The parties also entered into a patent cross-license agreement. Terms of the transaction were not disclosed. Patents acquired by Western Digital are in distributed storage, object storage, and emerging non-volatile memory. Western Digital expects the IP to further strengthen its technology leadership position and drive value creation for the company and its customers. The patents will augment Western Digital's existing portfolio of more than 10,000 patents and patent applications.
07:10 EDTWDC, STXWestern Digital pricing in 'extreme bear case,' says Jefferies
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05:21 EDTSTXStocks with implied volatility movement; STX SDRL
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