Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified

Seagate Technology

(

STX

) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Seagate Technology as such a stock due to the following factors:

  • STX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $288.2 million.
  • STX is up 2.2% today from today's close.

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More details on STX:

Seagate Technology Public Limited Company designs, manufactures, and sells electronic data storage products in the Asia Pacific, the Americas, and EMEA countries. The stock currently has a dividend yield of 4.5%. STX has a PE ratio of 8. Currently there are 10 analysts that rate Seagate Technology a buy, 2 analysts rate it a sell, and 6 rate it a hold.

The average volume for Seagate Technology has been 3.9 million shares per day over the past 30 days. Seagate Technology has a market cap of $15.2 billion and is part of the technology sector and computer hardware industry. The stock has a beta of 2.23 and a short float of 9.5% with 5.37 days to cover. Shares are down 26.5% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Seagate Technology as a

buy

. Among the primary strengths of the company is its respectable return on equity which we feel is likely to continue. We feel its strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.

Highlights from the ratings report include:

  • The revenue fell significantly faster than the industry average of 35.9%. Since the same quarter one year prior, revenues slightly dropped by 2.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Computers & Peripherals industry and the overall market, SEAGATE TECHNOLOGY PLC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The debt-to-equity ratio of 1.23 is relatively high when compared with the industry average, suggesting a need for better debt level management. Even though the debt-to-equity ratio is weak, STX's quick ratio is somewhat strong at 1.44, demonstrating the ability to handle short-term liquidity needs.
  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, STX has underperformed the S&P 500 Index, declining 18.89% from its price level of one year ago. Looking ahead, although the push and pull of the overall market trend could certainly make a critical difference, we do not see any strong reason stemming from the company's fundamentals that would cause a continuation of last year's decline. In fact, the stock is now selling for less than others in its industry in relation to its current earnings.
  • The gross profit margin for SEAGATE TECHNOLOGY PLC is currently lower than what is desirable, coming in at 33.78%. Regardless of STX's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, STX's net profit margin of 8.73% is significantly lower than the industry average.

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