Seagate reported fiscal Q2 EPS of $3.11, topping consensus by $0.34, while revenue of $2.83 billion exceeded estimates by $100 million. Year-over-year revenue growth was 21.5% and net margin reached 19.6%, driven by robust AI-centered data center demand and higher-density drives. Management set Q3 EPS guidance between $3.20 and $3.60 and noted that orders for fiscal 2026 are effectively fully booked, providing clear visibility into multi-year growth.

Shares trade at a premium P/E of approximately 30x and a PEG of 1.1, reflecting investors’ confidence in sustained double-digit growth. However, should memory supply catch up or hyperscale capex moderate, the multiple could contract sharply. The company’s strong backlog through 2028 underpins margin expansion expectations, but near-term momentum reversal remains a key risk for valuation comfort.

Since the Q2 beat, at least three major brokerages have lifted price targets by an average of 8%, with two adding or reaffirming “buy” ratings and one moving to “outperform.” Institutional investors have increased stakes by over 10% in aggregate during the past quarter. Meanwhile, insiders have sold roughly 125,000 shares over the last 90 days, representing less than 1% of total shares outstanding, signaling mixed signals on near-term upside from management.