In a report published on Monday, Piper Jaffray analyst Andrew J. Nowinski initiated coverage on Western Digital (NASDAQ: WDC) with an Overweight rating and a $77 price target.
In the report, Piper Jaffray stated, “There are four key investment points supporting our rating. First, we view the migration of data to the cloud as a long-term growth driver for Western Digital, from both a revenue and gross margin perspective. Second, we believe Western Digital has a number of levers for reducing costs, including a pending decision from MOFCOM that could unlock $1.02 of upside to consensus FY15 EPS. Third, Western Digital’s strong balance sheet and shareholder-friendly capital allocation policy positions the company favorably when compared to the peer group. Finally, we believe Western Digital could capture near-term market share as a result of the expiration of the long-term supply agreements Seagate signed following the flooding in Thailand.”
Western Digital closed on Monday at $65.22.
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Posted in: Analyst Color, Initiation, Analyst Ratings