Buffett Brain · Research note
Score updated 28 Oct 2026 · analysis from 2 Jun 2026
STX· Technology
Seagate Technology Holdings
Seagate is a fine hard-drive business priced like a software miracle at 82 times earnings.
Buffett fit
Partial fit
Owner
57
Durability
14
Management
51
Price
0
Score updated 28 Oct 2026 · analysis from 2 Jun 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Technology stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
If I owned all of Seagate, I would be enjoying the moment. A trailing return on capital of 45.8% means the current cycle is throwing off cash beautifully.
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This is where the case falls apart, and the durability score of 14 says as much.
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Management has shrunk the share count at 3.3% a year, which I respect, and they keep debt sensible at 0.36 times equity with interest covered 10.6 times over.
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There is none. An owner-earnings yield of 0.41% and a of 81.8 mean you are paying roughly 240 times the cash this business actually hands you.
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
6- 1Trailing is an exceptional 45.8%, showing the current up-cycle is extraordinarily profitable
- 2 of 41.5% and of 28.3% are unusually rich for a hardware manufacturer
- 3Share count has been reduced at 3.3% per year, quietly increasing each owner's slice of the business
- 4Balance sheet is reasonable, with of 0.36 and net debt actually negative at minus 0.23 times EBITDA
Concerns
6- 1Valuation is extreme: a of 81.8 and EV-to- of 104 price this cyclical business as if it were a flawless growth
- 2Owner-earnings yield is just 0.41% and earnings yield only 1.22%, so you are paid almost nothing for the risk
- 3Revenue has declined at 3.9% annually over five years, the opposite of the growth the price implies
- 4Durability score of 14 reflects brutal cyclicality, including a worst-year earnings decline near 134%
Price history
$700+624.0%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Seagate makes the spinning hard drives that store the world's data, and it earns its keep by manufacturing them at scale and selling the bulk of them to data-center customers. The economics right now look unusually good, with a 41.5% and a 28.3% riding an AI-driven boom in cloud storage demand. The trouble is that this is a commoditized, capital-hungry business whose revenue has actually shrunk at a 3.9% annual clip over five years.
How this analysis has moved
Oct 29, 2026: Probably Not to Unclear
Sep 27, 2026 → Oct 29, 2026
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
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Questions about Seagate Technology Holdings
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