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Western Digital Corp. designs, develops, manufactures, and sells hard drives for data storage.
With the amount of data created everyday and the transition to digital, all this data has to be stored on hard drives. Medical records are being kept electronically and with the aging US population, this will require a lot of hard drive space. Also cloud computing will require hard drives. Personal digital content is also increasing. I can't remember the last time I bought a CD. Disney's release of Little Mermaid is now being sold with a digital version. I am now considering buying WD personal cloud storage system so that I can access any of my digital content from anywhere. Convert the old CD collection to digital and free up shelf space.
Going long on WDC!!!! Cloud storage will continue to increase and with the acquisition of Velobit in July and recent acquisition of stec they look to be making a nice transition into getting there portion of the SSD market. From a tech background I love their product and currently use many of them which is always a fundamental basis on how I pick certain buys. Go long my friends!
Many investors have stayed away from this particular company because of the up and coming industry of cloud computing.... but all that cloud storage has to be on a hard drive somewhere. Western Digital is a long time player and first mover in the hard drive and data storage business. They are a solid company with a forward P/E just below 8 as I write this pitch. It also distributes a decent dividend which is always a plus in my investment book. Also inside ownership, profit margins, and ROE are all in the double digits. The business has solid financials with an equally solid track record. I say GO LONG! FOOL ON!
A good time to add shares. Data is multiping and companies need to store it somehow. Hard drives, Cloud, SSD, Western Digital does it all.
TMF Spiffy Pop
My friend Jim Mueller just said, over lunch, that this is one of his potentially favorite stocks of all, going forward. His premise is that while everything's going to the cloud, guess what the cloud is built on? So hey, I'm a Jim fan -- taking a flyer here on his word. Jim, don't let me down. Outperform.
Western Digital has been doing well and I believe this will continue as everything we are doing requires more storage.
Undervalued. Target $100 in 1-2 yrs.
Hard drives will always be in demand no matter what. Increasing demand for cloud storage will cause cloud storage providers to demand more hard drives. Even if the demand for cloud storage decreases (due to recent privacy/security scares), consumers will need to store their information on something, so they will end up purchasing their own hard drives.
This stock is cheap because people assume it is related to the weakening PC market. But Netflix has to store all its digital media on the cloud somewhere, and this hard disk maker is a leader here.
For reference point and to allow for comments by others. As of the end of March, 2013.ROE 25.13%Trailing PE 7.51PB 1.67Div yield 1.70%
I've been bullish on STX, so I guess I need to be bullish on WDC too. I don't believe the end is coming, as current valuations would imply. I think the opposite is true; I think cloud storage needs are going to make both of these companies explode.
Undervalued according to my intrinsic value calculations. The investing community has overreacted to the decline in demand for desktops/laptops vs. mobile devices and SSD vs. HDD with regard for demand of HDD. The shares of STX & WDC were already low following the flooding in Thailand in 2010 that affected component suppliers.
I actually came across this one on an Earnings Surprise Screen. WDC handily beat estimates with very strong sales (not just cost cutting). Upon further evaluation, WDC is generating healthy amounts of cash, sporting a high ROIC, and it looks quite cheap (even at moderate growth projections). I think this has a lot of upside. Let's see where it goes.
Strong core business plus starting a dividend
Extremely undervalued on YCharts. Revs, Operating Income, and Free Cash flow yield at all time highs and valuation metrics at all-time lows. Great buy, and I believe it is benefiting from Cloud computing and Big Data trends. I see that in my own enterprise.
The company has consistently made money and, although more expensive than Seagate on a P/E basis, has a strong buyback plan, more consistent earnings, a better, less leveraged financial position if further consolidation occurs and reports in a more investor friendly format.
Strong management team, especially now they have HGST under their arms.
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