Bank of America "10% drop is a buying opportunity"...Seagate target price raised to $1,150

▲ Seagate (STX)/Source: X

Wall Street analysis suggests that Seagate, which fell more than 10% in a single day due to a sharp decline in artificial intelligence (AI) related stocks, is actually a buying opportunity. Bank of America maintained its 'Buy' rating and raised its target price, suggesting further upside potential.

According to cryptocurrency specialized media Watcher.Guru on July 3 (local time), Seagate (STX) plunged more than 10% the previous day amid a general weakness in AI-related semiconductor stocks. It fell to $795 at one point during intraday trading, then partially recovered its losses to close at $820. The media reported that the area around $800 is currently acting as a major support level.

Wamsi Mohan, an analyst at Bank of America Securities, evaluated this correction as an opportunity to buy the dip in a report sent to clients. He specifically stated that the area below $800 could be a favorable buying zone for long-term investors, raising the target price from the previous $1,000 to $1,150. The 'Buy' rating was also maintained.

If the new target price is realized, it implies an upside potential of $330 per share, or approximately 40%, compared to the current stock price of $820. The media explained that based on this, an investment of $1,000 could grow to a value of approximately $1,400.

Although Seagate's stock price recently fell from a high of $915 to $820, the media assessed that there is a possibility of a rebound if investor sentiment in the overall AI sector recovers. In particular, Bank of America's upward revision of the target price is interpreted as reflecting confidence in long-term growth potential.

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