STX Should I Buy
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Buy STX now. Despite the sharp -8.71% regular-session drop, the broader technical structure remains bullish (stacked rising moving averages) and fundamentals/Street revisions are strongly positive after a standout 2026/Q2. With price still above the key pivot support (~383), the selloff looks more like a volatility reset than a trend break, which fits an impatient “buy-now” approach.
Trend is still bullish but cooling short-term. The moving averages are firmly bullish (SMA_5 > SMA_20 > SMA_200), suggesting the primary trend remains up. MACD histogram is positive (9.845) but “positively contracting,” implying upside momentum is fading and consolidation/pullbacks are possible. RSI(6) at ~61 is neutral-to-slightly-bullish (not overbought). Key levels: Pivot support ~383 (important hold level); resistance R1 ~435 then R2 ~468. At ~407 post-market, STX is above pivot and below R1—constructive for a buy-the-dip entry, but expect choppiness near-term.
Strong HDD pricing/supply discipline narrative: multiple analysts cited tight supply, favorable pricing, and improving margins/FCF outlook.
HAMR execution and hyperscaler/nearline cloud demand: repeated in analyst notes as a durable driver.
Positioning tailwind: Hedge funds are buying, with buying amount up ~221% over the last quarter.
Sector read-through: tech/semis/storage earnings tone (e.g., Western Digital excitement, Micron strength) supports a constructive backdrop for storage names.
Near-term tape risk: the stock just fell ~-8.71% in the regular session, signaling elevated volatility and potential further digestion.
Valuation concern flagged by UBS (Neutral): stock may be discounting a prolonged upcycle already.
Options show meaningful hedging (OI put/call 1.
and extremely high IV—market is not relaxed about near-term swings.
Congress trading: only sales (0 buys, 2 sells) in the last 90 days suggests cautious behavior from that cohort.
Latest quarter: 2026/Q2. Results show strong acceleration: Revenue $2.825B (+21.51% YoY), Net Income $593M (+76.49% YoY), EPS $2.6 (+67.74% YoY). Gross Margin 41.63% (up +19.22% YoY) indicates meaningful margin expansion—consistent with pricing strength, cost reductions, and improving mix. Overall, the quarter supports a higher earnings/FCF trajectory versus the prior year.
Wall Street trend is decisively upward: a wave of price-target raises and mostly bullish ratings immediately following the strong quarter/guidance. Bulls (Bernstein $500 Outperform, Baird $505 Outperform, Cantor $500 Overweight, Goldman $385 Buy, Citi $460 Buy, MS $468 Overweight, Mizuho $440 Outperform) emphasize tight supply, strong cloud demand, margin expansion, and HAMR momentum. The main bear/neutral counterpoint is valuation/stretch risk and “already pricing in” a long upcycle (UBS Neutral $385; some Equal Weight ratings like Barclays/Wells Fargo despite higher PTs). Net: pros see sustained fundamentals and margin/FCF upside; cons focus on how much optimism is already embedded in the stock price.
