New Solutions from Western Digital - Analyst Blog

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Bellwether hard disk drive (HDD) maker Western Digital Corp. ( WDC ) is launching a fleet of storage solutions targeting the tablet and data center space.

WD Se, which is an enterprise-class HDD, has been designed for use in big data centers to scale-out their performances. Usage of data centers are going up, but space storage remains the main limitation.

Western Digital's (or WD) Se HDDs are capable of storing 4-144 terabytes (TB) of data per square foot of data center. WD Se is expected to lower the cost of ownership for the data centers with minimal downtime, less supervision and efficient processing speed. The use of WD Se HDDs will also generate less heat from the data center.

Currently, the WD Se HDDs will be available in 2 TB and 4 TB capacities at $159.99 and $309.99, respectively. The drives carry a 5-year warranty.

WD also unveiled Travelstar 5K1500 HDD powered by Hitachi Global Storage Technologies ('HGST'), a unit of Hitachi Ltd. WD closed the acquisition in Mar 2012. The Travelstar 5K1500 HDD has a 9.5 mm form factor, 32 MB cache buffer and 6 Gbps SATA interface, with a capacity to store up to 1.5 TB. The drive can be used in notebooks, external drives, gaming consoles and all-in-one PCs.

The company expects to ship the HDDs by Jun 2013. The pricing of the device has not been announced.

Apart from this, Western Digital also announced that it will join forces with SanDisk Corp. ( SNDK ) to introduce a solid state hybrid drive ('SSHD'). The drive will feature SanDisk's flash memory technology and hard drive technology from Western Digital. The new SSHD namely, WD Black will offer hard drive-like capacity, slim form factor and flash memory-like fast performance.

Western Digital has limited exposure to high-end corporate desktop and enterprise server markets compared to its rival Seagate Technology plc. But we believe that with the introduction of WD Black (SSHD) in association with SanDisk and recently introduced drives, WD will be able to grow its market share in enterprise space.

It has also been noticed that the company is slowly shifting toward consumer electronics, branded and enterprise products. We believe that this will prove beneficial for WD as dependence on the PC market will be less.

We are also encouraged by Western Digital's impressive third quarter 2013 earnings, which surpassed the Zacks Consensus Estimate.

Currently, Western Digital has a Zacks Rank #2 (Buy). Investors can also consider other storage stocks such as Hutchinson Technology Inc. ( HTCH ) and NetApp Inc. ( NTAP ), having Zacks Rank #2 (Buy) and have solid visibility.



HUTCHINSON TECH (HTCH): Free Stock Analysis Report

NETAPP INC (NTAP): Free Stock Analysis Report

SANDISK CORP (SNDK): Free Stock Analysis Report

WESTERN DIGITAL (WDC): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: HTCH , NTAP , SNDK , WDC

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