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Morgan Stanley: Hard Drive Shortage to Last at Least Until 2028, Seagate and Western Digital Set for Major Gains

On June 16, Morgan Stanley significantly raised the target prices for Seagate Technology and Western Digital in a notice to clients, citing a survey in Asia that indicates the hard drive cycle is extending, with shortages expected to last at least until 2028. Analyst Erik Woodring raised Seagate's target price from $767 to $1,035 and Western Digital's target price from $488 to $650, maintaining an overweight rating for both. Woodring stated, "Our surveys in Asia over the past three weeks clearly show that the hard drive cycle is extending—shortages are expected to last at least until 2028—and also indicate that hard drive prices are strengthening significantly and meaningfully." The firm estimates that HDD demand is growing by 40% to 50% annually, while supply is increasing closer to 30% to 35%. Morgan Stanley noted that this gap is driving the shortage to "last at least until 2028."

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