WD Stocks up 10% to Seagate's 4%

[Jared]

Looks like all our efforts to tell people about what an inferior product Seagate is compared to HGST are paying off.
http://blogs.barrons.com/techtraderdail ... -says-rbc/

WD is seeing a surge in stock price. Up 10% compared to only a 4% increase in Seagate. I sure hope this trend continues as we see the transition over to SSD technology from both companies. The day I see a "DM" series SSD come in, I quit. :lol:

 

[HaQue]

Unless you figure out some easy recoveries for DM, then order that Ferrari..

What I found weird was some of the figures being reported.

http://www.securityworldhotel.com/na/News/Business-News/wd-publishes-solid-results1#.Vb0pwMsw9xQ

Western Digital Corp has just reported revenue of $3.2 billion and net income of $220 million, or $0.94 per share, for its fourth fiscal quarter ended July 3, 2015

so without going into why, in the previous 3 quarters their net was 1.2billion, and 220M seems rather low...

in 3 months they spent 3.2 billion and return was 220M... They need to spend a little over $145 to make $1

In AU, a quick Google on median yearly pay is between $54,000 and $70,000. If you run your own business you would want to do slightly better (otherwise why subject yourself to the added stresses) and for arguments sake, say $100,000 earnings (numbers are really not that important being so low)

your little Ma and Pa shop would need to receive in around $14.5Million

I'll admit my financial knowledge is extremely non-existant, but this seems simplisticly about right.

crazy right?

 

[LarrySabo]

Net income of .22 billion on revenues of 3.2 billion, is a 6.88% margin--not too shabby.

 

[HaQue]

I have no clue about business, so this is all pretty interesting.

Did some Googling, and seems really low if you put it in tech hardware and equipment category. I am guessing storage vendors have insane R&d, acquisition, legal/patent/IP protection costs tough.

This is 2012, but shows differences:
http://www.businessinsider.com.au/sector-profit-margins-sp-500-2012-8

 

[LarrySabo]

Those are staggering ROEs! The 6.88% I mentioned was not too far off the numbers in the chart. When you said "in 3 months they spent 3.2 billion and return was 220M" I think you meant to say their revenue was 3.2 billion. I find those ROEs incredibly high; how come our portfolio earnings don't reflect those numbers?

 

[HaQue]

Yes, spent should said received! had it right in my head, not customed to thinking in millions and billions !

I don't think reported numbers of others mean too much to us personally too much at all. we all will see one company doing well, another in the space doing poorly, the one doing well going bankrupt in a year and the one doing poorly still lumping along!

 

[Jared]

Don't forget they are incorporated so their net income doesn't include any of what was paid out to their employees, CEO, CFO, COO, or anyone else. Some of whom also had multi-million dollar income themselves. That $220 million is just the extra income left over after everything else was paid. Plus, these companies play all sorts of games to get the numbers down and avoid corporate income tax. I'd guess they bought HGST this year as a tax write off.

GE is a perfect example of this. They make hundreds of billions $$$, yet some years report a "loss" and get a tax return (if you can believe that). One year they actually paid negative taxes, meaning the government gave them more back than they paid in. But, the sucker who makes $30,000/yr better be prepared to fork half over.