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Seagate Technology (STX -0.56%) has experienced a remarkable rally over the past year due to improvements in the data storage industry and anticipation of increased demand for artificial intelligence (AI) technology. Over the last 12 months, its share price has climbed by 54%, while rising by 11% since the beginning of 2024. This positive momentum has led some investors on Wall Street to believe that Seagate has the potential for further growth.

Recently, Morgan Stanley upgraded its rating on Seagate stock from equal weight to overweight and raised its price target from $73 to $115 per share. If Seagate were to meet Morgan Stanley’s price target, it would reach an all-time high valuation and provide an upside of approximately 21% from its current trading price. The upgrade reflects the belief that Seagate is well-positioned in the industry, stands to benefit from cyclical improvements, and is likely to experience increased demand due to advancements in AI technologies.

The data storage market is known for being cyclical, with demand and pricing trends fluctuating over time. Currently, Seagate appears to be in a favorable position with tailwinds supporting its growth. Morgan Stanley anticipates Seagate’s earnings for the year to be 25% to 30% higher than previously estimated, with the potential for AI-related storage needs to provide a long-term boost. As the demand for AI technology continues to rise, Seagate could be entering a period of significant growth.

While there are still uncertainties about how AI will impact Seagate’s business, there is a clear trend that suggests that it is on track for robust growth in this sector. This aligns with Morgan Stanley’s positive outlook on the stock as a promising investment opportunity. With increasing demand for data storage solutions in the AI sector, there is significant potential for Seagate’s continued success in this area of tech development.

In conclusion, investors should keep an eye on Seagate Technology (STX -0.56%) as it continues its upward trajectory fueled by advancements in AI technology and cyclical improvements in the data storage market. With growing demand for data storage solutions in this sector, there are significant opportunities ahead for this promising tech company.

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