Western Digital Corp (NASDAQ:WDC) has filed with the Securities and Exchange Commission (SEC) to register for resale shares of its preferred and common stock. On Monday, the company initiated the process for the potential resale of up to 235,000 shares of Series A Convertible Perpetual Preferred Stock, with a par value of $0.01 each, and up to 10,000,000 shares of common stock, also with a par value of $0.01, which are issuable upon the conversion of the preferred stock.
The registration was made through a registration statement and a related prospectus supplement.
Western Digital, based in San Jose, California, is known for its role in the computer storage devices industry. The company has included the legal opinion and consent of Skadden, Arps, Slate, Meagher & Flom LLP as Exhibit 5.1 in the current report, which also becomes part of the company’s Registration Statement on Form S-3ASR (File No. 333-281780).
This move comes as part of Western Digital's ongoing financial activities and does not necessarily indicate an immediate sale of shares but allows for the possibility of such transactions in the future. The registration of these shares provides the company with flexibility in its capital structure management.
The information for this article is based on a press release statement from the company.
In other recent news, Western Digital Corp. reported significant earnings per share beat at $1.44, compared to the predicted $1.18, with robust Q4 revenues of $3.8 billion. This strong performance was due to substantial margin growth in both the Hard Disk Drive (HDD) and Flash segments.
The company also saw a 14% rise in HDD revenue quarter over quarter, indicating notable market share gains. However, Flash revenue grew by only around 3%, due to a decrease in bit shipments.
Evercore ISI reaffirmed its Outperform rating for Western Digital, while Benchmark projected non-GAAP earnings of $8.39 per diluted share for fiscal year 2025. Other firms, including Morgan Stanley, Rosenblatt, Wells Fargo, Susquehanna, and Mizuho, also expressed confidence in Western Digital's financial outlook.
Despite these positive developments, Western Digital's guidance for the September quarter was slightly below expectations, reflecting potential softness in Flash revenues. The company anticipates dis-synergy charges related to the planned spin-off but remains optimistic about the shift to a build-to-order model for HDDs.
InvestingPro Insights
As Western Digital Corp (NASDAQ:WDC) navigates its financial activities, including the recent SEC filing for stock resale, investors are keenly observing the company's performance metrics and market position. According to InvestingPro, Western Digital is anticipated to see net income growth this year, which aligns with the company's recent earnings beat and the robust Q4 revenues reported. This expected growth can be attributed to their substantial margin growth in HDD and Flash segments, as well as market share gains highlighted by the 14% rise in HDD revenue.
Moreover, analysts are optimistic about sales growth in the current year for Western Digital. This is particularly relevant as the company continues to manage its capital structure and potentially prepares for future transactions. The positive outlook from analysts such as Evercore ISI and Benchmark supports this sentiment, considering the company's strong financial performance and strategic market positioning.
However, it's worth noting from InvestingPro Tips that Western Digital has been flagged for weak gross profit margins and is trading at high EBIT and EBITDA valuation multiples. While the company is a prominent player in the Technology Hardware, Storage & Peripherals industry, these metrics suggest that investors should keep an eye on profitability and valuation levels as they assess the company's financial health.
For those seeking deeper analysis, InvestingPro offers additional insights into Western Digital's financials and market performance. Currently, there are 10 more InvestingPro Tips available for Western Digital at https://www.investing.com/pro/WDC, providing a comprehensive overview for investors and analysts alike.
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