Seagate HDD Cayman - October 2021 (LTM): Peer Snapshot

Seagate HDD Cayman: Updated credit analysis after change in ratings outlook to negative - Credit Opinion – 2023/05/26 – US$ 250.00 – ...Seagate has good operating scale and strong market position as one of the two principal suppliers of high-capacity Hard Disk Drives (HDDs). HDDs are the primary, cost-effective storage solutions for the hyperscale cloud segment that has strong long-term growth prospects, and other applications with large data storage requirements. We expect Seagate's revenue growth to average 2% to 4% over the next 2 to 3 years. However, the sharp and protracted cyclical downturn currently underway will substantially erode Seagate's credit metrics and the company expects an inflection in demand for HDDs will likely be delayed to late 2023 as inventory in the channel remains high. We expect adjusted operating profits to decline about 80% in FY '23, and weak earnings to persist through the first half of FY '24. As a result, total debt to EBITDA (with substantial add-backs) will exceed 7x (Moody's adjusted) at its peak in the first half of FY '24 and we expect negative free cash flow (after dividends) through...

Moody's changes Seagate's ratings outlook to negative; affirms Ba2 CFR - Rating Action – 2023/05/22 – US$ 180.00 – ...MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER. ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT. MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT...

Seagate HDD Cayman: Updated credit analysis after ratings downgrade - Credit Opinion – 2022/11/18 – US$ 250.00 – ...Seagate has good operating scale and strong market position as one of the two suppliers of high-capacity Hard Disk Drives (HDDs). HDDs are the primary, cost-effective storage solutions for the fast-growing hyperscale cloud segment and applications with large data storage requirements. We expect Seagate's revenue growth to average 2% to 4% over the next 2 to 3 years. However, the sharp cyclical downturn underway will substantially erode Seagate's credit metrics. We expect adjusted operating income to fall 60% to 70% in FY '23 and total debt to EBITDA to approach or exceed 5x (Moody's adjusted) by the end of FY '23. Seagate has high business risks from its revenue concentration in the HDD product category, ongoing substitution risks from flash memory in legacy end markets that still account for a meaningful share of its revenues, and sustained pricing pressure that it needs to offset through technology innovation and growth in capacity shipments. Product cycles are short and execution risk...

Moody's downgrades Seagate's CFR to Ba2; outlook stable - Rating Action – 2022/11/08 – US$ 180.00 – ...MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER. ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT. MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT...

Seagate HDD Cayman - December 2021 (LTM): Peer Snapshot - Peer Snapshot – 2022/02/28 – US$ 750.00 – ...Ba1 Stable Baa3 Stable Baa3 Stable Seagate HDD Cayman Western Digital Corporation Micron Technology, Inc....

Seagate HDD Cayman: Updated credit analysis after ratings affirmation - Credit Opinion – 2021/10/20 – US$ 250.00 – ...Seagate has good scale and leading market share in the Hard Disk Drive (HDD) market. It benefits from the strong long-term demand prospects for data storage capacity primarily driven by demand from the hyperscale cloud end market, which will more than offset declining revenues from Seagate's legacy markets. We expect a strong cyclical rebound to drive adjusted operating profit growth of about 18% in FY '22. The company has very good liquidity and we expect it to maintain total debt to EBITDA (Moody's adjusted) of about 2.5x and generate free cash flow (after dividends) in the mid-teens percentages of total debt over the next 12 to 18 months. Seagate has high business risks from its revenue concentration in the HDD product category, substitution risks from flash memory in legacy end markets, and pricing pressure. Growing revenue concentration in the fast-growing hyperscale cloud end market and customers within that market could increase revenue variability. Product cycles are short and execution...

Moody's affirms Seagate's Ba1 CFR; outlook stable - Rating Action – 2021/10/18 – US$ 180.00 – ...MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER. ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT. MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT...

Seagate HDD Cayman - July 2021 (LTM): Peer Snapshot - Peer Snapshot – 2021/09/10 – US$ 750.00 – ...Seagate HDD Cayman Western Digital Corporation Micron Technology, Inc. Ba1 Stable Baa3 Negative Baa3 Stable...

Seagate HDD Cayman - April 2021 (LTM): Peer Snapshot - Peer Snapshot – 2021/06/08 – US$ 750.00 – ...Seagate HDD Cayman Western Digital Corporation Micron Technology, Inc. Ba1 Stable Baa3 Negative Baa3 Stable...

Seagate HDD Cayman: Updated credit analysis - Credit Opinion – 2020/12/07 – US$ 250.00 – ...Seagate benefits from the growing demand for data storage driven by the secular shift toward cloud computing and other emerging applications. It is one of the two leading suppliers of Hard Disk Drives (HDDs) globally. We expect Seagate to maintain very good liquidity, financial leverage below 3x (Moody's adjusted), and generate free cash flow (after dividends) of about 10% of adjusted debt over the next 12 to 24 months. But Seagate's high business risks and its aggressive shareholder returns strategy, including a substantial increase in debt for share repurchases, constrain its credit profile. Seagate's business risks are high as a result of its revenue concentration in the HDD product category, substitution risks from flash-based Solid State Drives (SSD) in many end markets, high demand volatility, and pricing pressure. In addition, product cycles are short and execution risk in managing technology transitions and global supply chains is high. We expect the product mix shift toward high...