Seagate Technology Holdings (NASDAQ:STX) Shows High Growth Momentum and Strong Technical Setup

For investors looking to join solid earnings momentum with positive technical patterns, a multi-layered screening method can be very useful. One approach is to select for stocks that show firm fundamental growth traits, as shown by a High Growth Momentum (HGM) score, while also presenting both a sound primary trend and a helpful price formation. This tactic seeks to find companies where notable earnings speed is meeting a technical framework that hints at a possible extension of the upward move, providing a combination of fundamental and technical support.

Seagate Technology Holdings (NASDAQ:STX) appears as a result from such a filter, fitting the requirements of an HGM score over 4, a Technical Score over 7, and a Setup Score over 7. The company, a top provider in data storage, is showing a marked improvement in its financial results, which is exactly the type of earnings momentum the HGM score is meant to find.

Fundamental Growth Momentum

The High Growth Momentum score brings together a few main parts of short-term earnings strength, including growth rates, speed changes, profit margin improvement, and analyst outlook. For Seagate, the given data shows a company in the middle of a notable earnings rebound phase.

• Notable Earnings Growth: The most clear numbers are the year-over-year earnings growth rates. The Trailing Twelve Month (TTM) EPS has risen by 196.4%, after even larger full-year growth of 532.8% and 611.1% in the two previous fiscal years, recovering from a low point.
• Firm Sequential Results: While the very high growth rates from the rebound's early stages are slowing, recent quarter-over-quarter growth stays solid. The last reported quarter had EPS grow 65.2% from the same time last year, with the earlier quarters showing increases of 146.7% and 475.8%.
• Margin Improvement Lifting Profits: A vital part of good growth is rising profitability. Seagate's profit margin has steadily increased, going from 14.5% three quarters ago to 20.9% in the latest quarter. This improvement shows the company is turning more revenue into profit.
• Upward Analyst Changes: Future estimates are also rising, with the average EPS estimate for the next fiscal year adjusted up by 10.7% over the past three months. This positive analyst view is a main part of the HGM method, as it shows more belief in the company's short-term future.

These items together lead to Seagate's HGM score of 6, indicating firm basic earnings momentum needed for the investment tactic.

Technical Strength and Setup Condition

While firm fundamentals give the "why," technical study helps find the "when." According to the detailed ChartMill Technical Report, Seagate's chart shows both very good trend condition and a helpful price pattern.

• Top Technical Score: STX receives a highest score of 10 for its Technical Score. The report states both its long-term and short-term trends are positive, with the stock doing better than 98% of the market over the last year. It is trading near 52-week highs and above all main moving averages (20, 50, 100, and 200-day), a clear sign of a firm, continuing upward trend.
• Helpful Setup for Purchase: Maybe more key for timing, the stock has a Setup Score of 7. The study shows prices have been moving in a range lately after a firm rise, making a possible base. A defined support area is found between $277.64 and $282.84, giving a sensible zone for a stop-loss order. The setup review indicates very little resistance stays just above the present price, which might allow for a continued move if the stock moves higher.
• Automatic Trade Idea: The technical report describes a sample setup using these points, suggesting a purchase point just above a small trendline resistance at $284.75, with a stop loss set below the support zone. This shows how the mix of a high technical score and a clear setup can become a specific, risk-managed trade plan.

A Meeting Opportunity

Seagate Technology presents a situation where a clear fundamental story—a sharp earnings rebound led by margin improvement and firm need for data storage—is confirmed by a technically sound chart. The high Technical Score affirms institutional interest and a dominant upward trend, while the high Setup Score hints the stock might be resting within that trend, giving a possible purchase point. This match is the main goal of the screening tactic: to find companies where growth momentum is not only a past event but is happening inside a positive price framework that may come before more progress.

For investors wanting to review other stocks that fit this mix of high growth momentum and technical breakout formations, the filter used to find Seagate is ready to use: Discover More High Growth Momentum Breakout Setups.

Disclaimer: This article is for information only and is not investment advice, a suggestion, or an offer to buy or sell any security. The study is based on given data and should not be the only reason for any investment choice. Always do your own research and think about talking with a qualified financial advisor before any investment. Past results do not show future outcomes.