Canada Markets open in 3 hrs 52 mins

Western Digital's New Drives Offer Immersive Gaming Experience

Zacks Equity Research

Western Digital Corporation WDC recently rolled out five new high storage capacity drives at Gamescom 2019 event in Cologne, Germany. The company aims to provide PC gamers and console users an immersive gaming experience with the new drives.

The company expanded Black gaming portfolio with WD_Black P50 solid-state drive (SSD), and WD_Black P10 and WD_Black D10 hard disk drives (HDDs).

Western Digital is also offering WD_Black D10 and WD_Black P10 HDDs for Microsoft’s MSFT gaming console — Xbox One with free subscription of Xbox Game Pass Ultimate for select time period. This is anticipated to bolster early adoption of the drives.

Moreover, both WD_Black D10 HDD and WD_Black D10 HDD for Xbox One, support read speed of up to 250MB/s with active cooling technology enabled 7200RPM.

PC gamers and Xbox One users are likely to benefit greatly from the feature-rich new products. The new gaming drives launch is expected to aid the company in strengthening market position against storage peers, including Seagate Technology STX.

Into the Headlines

The high-performance WD_Black P10 HDD comes in storage capacity variants of 2TB up to 5TB, and features a portable form factor with USB 3.2 Gen 1 compliant port.

WD_Black D10 HDD offers storage capacity of up to 8 TB. Meanwhile, WD_Black P50 SSD offers up to 2TB of extra storage, featuring read speeds up to 2000MB/s and USB 3.2 compliant gen 2x2 port.

Coming to WD_Black P10 HDD for Xbox One comes in storage capacity variants of 3TB to 5TB, with MSRP ranging from $109.99 to $149.99. WD_Black D10 for Xbox One featuring storage capacity of up to 12 TB comes at an MSRP of $299.95. Western Digital anticipates both the drives to be available “this quarter.”

What Investors Should Know?

Talking about the price performance, shares of Western Digital have gained 58.4% year to date, compared with the industry’s growth of 5.5%.

An improving trend in PC shipments favors business prospects of Western Digital, which continues to depend substantially on PC sales. Per Gartner’s preliminary data, PC shipments in the second quarter 2019 improved 1.5% year over year to 63 million units. Going by the IDC report, shipment rose 4.7% on a year-over-year basis and totaled 64.9 million in the period under review.

Notably, per recent IDC estimates, the global datasphere will grow to 175 zettabytes (that is a trillion gigabytes) by 2025, from 33 zettabytes in 2018. The effective storage is absolutely essential to properly harness this data which favors the adoption of Western Digital’s latest solutions.

Markedly, the gaming market is projected to hit $174 billion by 2021 from $134.9 billion estimated in 2018, per a report by Newzoo. This reinforces the growth prospects of Western Digital’s expanding gaming portfolio.

Notably, Microsoft has a strong foothold in the console gaming market, which is likely to aid Western Digital in bolstering adoption of HDDs for Xbox One.

We believe this ongoing expansion of its product portfolio is likely to generate incremental revenues in the quarters ahead, which bodes well for the top line.

Zacks Rank & Another Stock to Consider

Western Digital carries a Zacks Rank #2 (Buy).

Perficient PRFT, currently flaunting a Zacks Rank #1 (Strong Buy) is another stock in the broader technology sector worth considering. You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rate for Perficient is currently pegged at 10.75%.

Biggest Tech Breakthrough in a Generation

Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.

A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 7 stocks to watch. The report is only available for a limited time.

See 7 breakthrough stocks now>>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Seagate Technology PLC (STX) : Free Stock Analysis Report
Western Digital Corporation (WDC) : Free Stock Analysis Report
Perficient, Inc. (PRFT) : Free Stock Analysis Report
Microsoft Corporation (MSFT) : Free Stock Analysis Report
To read this article on click here.
Zacks Investment Research