Seagate Technology PLC

NASDAQ:STX

Shayne Heffernan

Symbol STX

Exchange Nasdaq

Current Price 13.03

52 Week High/ Low 9.84 – 21.58

Shares Outstanding 472.69M

Market Cap 6.55B

P/E Ratio 4.48

Recommendation:

Seagate rates a very strong buy given the fall

on rejecting a buyout.

Price Target $28.50 in 2011

Low P/E and Book Value

Strong sales growth

Short Interest 16,459,248.00 will be forced to

cover as the company buys back stock

Key Developments:

• Rejected buyout offer and elected to buy

back $2b of stock

• Seagate Technology announced that for

the second quarter of 2011, it expects

revenue to be at least $2.7 billion

• Seagate Technology and Samsung

Electronics Co., Ltd., announced that

they have entered into a joint

development and licensing agreement.

About the Company

Fiscal 2010 revenue: Approximately $11.4 billion.

Fiscal 2010 net income: Approximately $1.6 billion.

Fiscal 2010 earnings per share: Diluted earnings of $3.14 per share.

Fiscal 2010 units shipped: Over 193 million.

Seagate Technology plc (Seagate) designs, manufactures, markets and sells hard disk drives. The

Company produces a range of disk drive products addressing enterprise applications, where its

products are primarily used in enterprise servers, mainframes and workstations; client compute

applications, where its products are used in desktop and notebook computers; and client non-

compute applications, where its products are used in a variety of devices, such as digital video

recorders (DVRs), and other consumer electronic devices, such as personal data backup systems,

portable external storage systems and digital media systems. The Company sells its disk drives

primarily to major original equipment manufacturers (OEMs), distributors and retailers. In

addition to manufacturing and selling disk drives, the Company provides storage services for

small- to medium-sized businesses, including online backup, data protection and recovery

solutions.

Seagate offers a range of disk drive products for the enterprise, client compute and client non-

compute market applications. It offer more than one product within each product family and

differentiate products on the basis of price, performance, form factor, capacity, interface, power

consumption efficiency, security features like full disk encryption and other customer integration

requirements. Its product offerings include Cheetah SCSI/SAS/Fibre Channel Family; Savvio

small computer system interface/ serial attached SCSI (SCSI/SAS); Fibre Channel Family;

Barracuda ES serial advanced technology architecture (SATA) Family; Constellation ES SATA

Family; Momentus advanced technology attachment (ATA)/SATA Family; Barracuda

ATA/SATA Family; Pipeline HD and DB35 SATA Family, and Pipeline Mini SATA Family.

Seagate’s Cheetah 3.5-inch disk drives ship in 10,000 and 15,000 revolutions per minute (RPM)

and in storage capacities ranging from 73 gigabytes to 600 gigabytes. Commercial uses for

Cheetah disk drives include Internet and e-commerce servers, data mining and data warehousing,

mainframes and supercomputers, department/enterprise servers and workstations, transaction

processing, professional video and graphics and medical imaging. The Company ships its fourth

generation Savvio 2.5-inch enterprise disk drive featuring increased throughput and improved

power consumption, targeted at space optimized enterprise storage systems. Its Savvio disk drives

ship in 10,000 and 15,000 RPM and in storage capacities ranging from 73 gigabytes to 600

gigabytes. Seagate’s

The Company’s Barracuda ES 3.5-inch disk drives ship in 7,200 RPM and in storage capacities

ranging from 250 gigabytes to 2 terabytes. The Barracuda ES addresses the market in enterprise

storage using nearline storage systems for capacity-intensive enterprise applications that require

space optimization, maximized performance and availability. It has also introduced Barracuda ES

drives for the surveillance market with capacities ranging from 250 gigabytes to 1 terabytes. Its

Constellation disk drives ship in both 2.5-inch and 3.5-inch and in storage capacities of up to 500

gigabytes to 2 terabytes, respectively, at 7,200 RPM.

Seagate’s Momentus family of disk drives for mobile computing disk drive products ship in 5,400

and 7,200 RPM and in capacities ranging from 80 gigabytes to 640 gigabytes. Momentus disk

drives are used in notebooks for business, government, education and consumer applications.

Consumer uses for Momentus disk drives also include tablet computers and digital audio

applications. Its Barracuda 3.5-inch disk drive delivers storage capacities of up to 2 terabytes at

7,200 RPM and is designed for applications, such as PCs, workstations and personal external

storage devices.

The Company sells its 3.5-inch Pipeline HD and DB35 disk drives primarily for use in DVRs.

These disk drives are optimized for digital entertainment and range from 160 gigabytes to 1

terabytes. It sells its 2.5-inch, 5,400 RPM Pipeline Mini disk drives, with capacities ranging from

160 gigabytes up to 500 gigabytes, for use in low-profile DVRs, gaming consoles, home

entertainment devices and small footprint media PCs. Seagate ships external backup storage

solutions under its Free Agent Go and Free Agent Go Flex product lines. Both of these product

lines utilize its 3.5-inch and 2.5-inch disk drives, which are available in capacities up to 2

terabytes and 750 gigabytes, respectively.

The Company competes with Western Digital Corporation, Hitachi Global Storage Technologies,

Samsung Electronics Co., Ltd., Toshiba Corporation, Micron Technology, Inc., SanDisk

Corporation, Intel Corporation and STEC Inc.

Recent News

Fitch Upgrades Seagate Technology's IDR to 'BB+'; Outlook Stable

Wednesday, 28 Apr 2010 03:15pm EDT

Fitch Ratings announced that it has upgraded the Issuer Default Rating (IDR) of Seagate

Technology to 'BB+' from 'BB'. The rating outlook is stable.

Seagate Technology Terminates Private Equity Discussions; Announces Share Repurchase

Authorization

Monday, 29 Nov 2010 04:21pm EST

Seagate Technology announced that Board of Directors terminated discussions with private equity

firms regarding a going private transaction, principally because it determined that the indications

of the valuation range were not in the best interest of the Company and its shareholders. As

previously announced by Seagate, the Company had received a preliminary indication of interest

regarding a going private transaction and its board of directors was in discussions with that party.

Additionally, Seagate's Board of Directors has authorized the Company to repurchase up to an

additional $2 billion of its outstanding ordinary shares. This new share repurchase authorization

continues Seagate’s commitment to enhancing shareholder value. Seagate expects to fund the

share repurchase through a combination of cash on hand, future cash flow from operations and

potential alternative sources of financing.

Share repurchases under this authorization may be made through a variety of methods, which may

include open market purchases, privately negotiated transactions, block trades, accelerated share

repurchase transactions, or by any combination of such methods.

The timing and actual number of shares repurchased will depend on a variety of factors including

the ordinary share price, corporate and regulatory requirements and other market and economic

conditions. The share repurchase authorization may be suspended or discontinued at any time.

Valuation Ratios

Company Industry Sector S&P 500

P/E Ratio (TTM) 4.49 15.64 23.03 17.89

P/E High - Last 5 Yrs. NA 4.33 1.45 19.18

P/E Low - Last 5 Yrs. NA 1.01 0.36 4.87

Beta 1.98 1.22 1.08 1.26

Price to Sales (TTM) 0.57 0.67 2.59 2.08

Price to Book (MRQ) 2.24 2.21 3.42 2.86

Price to Tangible Book (MRQ) 2.25 2.63 4.07 7.85

Price to Cash Flow (TTM) 2.80 8.90 8.79 10.46

Price to Free Cash Flow (TTM) 6.63 17.73 14.72 47.51

Profitability Ratios

Company Industry Sector S&P 500

Gross Margin (TTM) 27.14 14.16 30.50 33.13

Gross Margin - 5 Yr. Avg. 22.29 13.89 36.73 29.48

EBITD Margin (TTM) 22.00 -- -- --

EBITD - 5 Yr. Avg 10.59 7.36 24.05 18.73

Operating Margin (TTM) 15.30 5.29 12.62 --

Operating Margin - 5 Yr. Avg. 3.56 5.07 13.99 16.26

Pre-Tax Margin (TTM) 13.49 5.54 13.14 15.06

Pre-Tax Margin - 5 Yr. Avg. 2.86 5.48 12.45 15.87

Net Profit Margin (TTM) 13.82 4.35 9.83 11.19

Net Profit Margin - 5 Yr. Avg. 2.73 4.17 9.53 11.65

Effective Tax Rate (TTM) -2.40 19.79 21.56 49.38

Effecitve Tax Rate - 5 Yr. Avg. 4.49 17.86 28.87 25.27

Efficiency

Company Industry Sector S&P 500

Revenue/Employee (TTM) 217,281 17,388,946 13,597,194 683,552

Net Income/Employee (TTM) 30,019 533,491 1,217,713 86,580

Receivable Turnover (TTM) 8.30 7.51 5.13 10.76

Inventory Turnover (TTM) 12.20 12.19 84.31 6.87

Asset Turnover (TTM) 1.54 1.98 0.80 0.56

Management Effectiveness

Company Industry Sector S&P 500

Return on Assets (TTM) 21.21 7.24 9.48 6.11

Return on Assets - 5 Yr. Avg. 3.46 7.52 10.88 5.85

Return on Investment (TTM) 35.19 15.36 12.32 7.85

Return on Investment - 5 Yr. Avg. 5.29 15.24 14.96 7.57

Return on Equity (TTM) 67.16 17.87 14.68 18.37

Return on Equity - 5 Yr. Avg. 7.95 16.70 16.06 9.37

Shayne Heffernan PhD

Shayne Heffernan of Ebeling Heffernan holds a PhD in Economics serves as CEO of Heffernan Holdings Inc and Co Founder of Ebeling Heffernan www.ebeling-heffernan.com and oversees trading at Heffernan Capital Management www.heffcap.com

Bangkok

Suite 53 Athenee Tower 63 Wireless Road, Lumpini, Pathumwan, Bangkok 10330 THAILAND

Tel: +66 2 126 8000 Fax: +66 2 126 8080

New York

347 5th Avenue, Suite 1402-508 Ny, NY 10016

Tel: +1 646-403-9881 Fax: +1 646-403-8014

Singapore

3 Raffles Place #07-01 Bharat Building Singapore 048617

Tel: +65 6329 6408Fax: +65 6329 9699

Disclaimer

Ebeling Heffernan (EH) distributes research and other information purchased and compiled from outside sources and analysts. This

report/release/advertisement is a commercial advertisement and is for general information purposes only. Do not base any investment decision

on information in this report/release/advertisement. EH is not a registered Investment Advisor or a member of any association for other

research providers. Under no circumstances is this report/release/advertisement to be used or considered as an offer to sell or a solicitation of

any offer to buy any security or other debt instruments, or any options, futures or other derivatives related to such securities herein. All

information herein is not intended to be used for investment advice. Price Targets are academic theory and should not be relied upon. The

majority of these profiled companies are highly risky OTC Bulletin Board or Pink Sheet companies. All readers of this information indemnify EH

from any liability for all accessed information. EH will not be responsible for updating any of its information in its report/release/advertisements.

EH advises recipients of all such data to be validated from the issuing company including all statistical information derived from SEC filings, from

data sources or financial information and data from the issuing company contained herein. The reader should seek professional financial advice,

verify all claims and do his/her own research and due diligence before investing in any securities mentioned. EH will not be liable to any person

or entity for the quality, accuracy, completeness, reliability or timeliness of information in this report/release/advertisement, or for any

direct, indirect, consequential, incidental, special or punitive damages that may arise out of the use of information, products or services from any

person or entity including but not limited to lost profits, loss of opportunities, trading losses, and damages that may result from any

incompleteness or inaccuracy in any of EH’s profiled companies. When paid in stock, EH its affiliates, directors, officers, outside sources, investor

awareness groups and employees may liquidate shares at any time or hold for investment purposes. Readers are advised to review SEC periodic

reports: Forms 10-Q, 10K, Form 8-K, insider reports, Forms 3, 4, 5 Schedule 13D, www.sec.gov.nasd.com, www.pinksheets.com, www.sec.gov

and www.finra.com. SPC is compliant with the Can Spam Act of 2003. Investing in micro cap and small cap securities is speculative and carries a

high degree of risk. Investors can lose their entire investment. The Private Securities Litigation Reform Act of 1995 provides investors a 'safe

harbor' in regard to forward-looking statements. EH cautions all investors that such forward-looking statements in this

report/release/advertisement are not guarantees of future performance. Investors should understand that statements regarding future

prospects may not be realized. This report/release/advertisement does not have regard to the specific investment objective, financial situation,

suitability, and the particular need of any specific person who may receive this report/release/advertisement. Investors should note that income

from such securities, if any, may fluctuate and that each security's price or value may rise or fall substantially. Accordingly, investors may receive

back less than originally invested, or lose their entire investment. Past performance is not indicative of future performance. The Company has

not paid compensation for this commercial advertisement. HCM. has written this commercial advertisement for EH.