#5: Seagate Technology
YTD Performance: +83%
It’s the post-PC age, and many “old tech” giants are suffering as a result. Case in point: Dell (NASDAQ:DELL) and Hewlett-Packard (NYSE:HPQ) are both continuing their slow march to irrelevance, as measured by slumping stock prices and fading earnings.
So you might be surprised to see that one of the biggest hard disk drive makers in the world, Seagate Technology (NASDAQ:STX), is one of the top performers this year. In fact, Seagate stock is above its pre-recession highs.
The surge comes from a convergence of low expectations (STX stock had crashed to lows of about $10 as recently as a year ago) and easier year-over-year comparisons (flooding in Southeast Asia, where Seagate makes many disk drives, severely limited production and profits in 2011). Investors have been thrilled with the stock as it just finished its fiscal 2012 with a whopping $6.49 in earnings per share, compared with just $1.09 in fiscal 2011.
The million-dollar question, of course, is whether Seagate can keep this up. The secular trend weighing on old technology makers is big, but the P/E of the company remains less than 5 right now, which could keep STX looking attractive to the value crowd.