Western Digital Shares Popped: What You Need to Know
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of hard disk drive maker Western Digital (NYS: WDC) climbed 10% Friday after resuming production in Thailand ahead of schedule and, in turn, raising its revenue outlook.
So what: Western Digital has been the disk drive maker worst-hit by the Thai floods, but the announcement suggests that it will be able to regain the market share it lost to main rival Seagate Technologies (NAS: STX) much faster than expected. In fact, Seagate shares -- which have been on fire over the past couple of months -- are down 5% on today's news.
Now what: Western Digital now sees current-quarter revenue of at least $1.8 billion, up nicely from its prior view of $1.05 billion to $1.25 billion. "Much work remains to be done, but we couldn't be more pleased with the effort and results thus far," said CEO John Coyne. More important, with Western Digital shares still down about 24% from April highs and sporting a P/E below 8, investors still have room to benefit from further recovery.
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At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.