How Will Seagate Stock React To Its Upcoming Earnings?

Seagate (NASDAQ: STX) is set to report its fiscal fourth-quarter earnings on Tuesday, July 29, 2025 (June fiscal year). Analysts predict the company will report earnings of $2.43 per share on $2.42 billion in sales. This would represent a flat growth in earnings and a 28% increase in sales compared to the previous year’s figures of $2.44 per share and $1.89 billion, respectively. Historical data shows that the stock has increased 55% of the time in the one day following earnings announcements, with a median rise of 6.1% and maximum one-day positive returns reaching 12%.

Seagate projects Q4 adjusted EPS (June fiscal year) between $2.20 and $2.60, on revenue of $2.25–$2.55 billion. Consensus forecasts 38% revenue growth in FY 2025 and 13% in FY 2026. The company has $32 Bil in current market capitalization. Revenue over the last twelve months was $8.5 Bil, and it was operationally profitable with $1.6 Bil in operating profits and net income of $1.5 Bil. While a lot will depend on how results stack up against consensus and expectations, understanding historical patterns might turn the odds in your favor if you are an event-driven trader.

There are two ways to do that: understand the historical odds and position yourself before the earnings release, or look at the correlation between immediate and medium-term returns post-earnings and position yourself accordingly after the earnings are released. That said, if you seek upside with lower volatility than individual stocks, the Trefis High Quality portfolio presents an alternative, having outperformed the S&P 500 and generated returns exceeding 91% since its inception. See earnings reaction history of all stocks.

Image by K. Mishina from Pixabay

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Seagate’s Historical Odds Of Positive Post-Earnings Return

Some observations on one-day (1D) post-earnings returns:

• There are 20 earnings data points recorded over the last five years, with 11 positive and 9 negative one-day (1D) returns observed. In summary, positive 1D returns were seen about 55% of the time.
• Notably, this percentage increases to 64% if we consider data for the last 3 years instead of 5.
• Median of the 11 positive returns = 6.1%, and median of the 9 negative returns = -7.9%

Additional data for observed 5-Day (5D), and 21-Day (21D) returns post earnings are summarized along with the statistics in the table below.

Correlation Between 1D, 5D, and 21D Historical Returns

A relatively less risky strategy (though not useful if the correlation is low) is to understand the correlation between short-term and medium-term returns post earnings, find a pair that has the highest correlation, and execute the appropriate trade. For example, if 1D and 5D show the highest correlation, a trader can position themselves “long” for the next 5 days if 1D post-earnings return is positive. Here is some correlation data based on 5-year and 3-year (more recent) history. Note that the correlation 1D_5D refers to the correlation between 1D post-earnings returns and subsequent 5D returns.

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