Seagate Technology Just Got Added to the Nasdaq 100. Time to Buy?[Stocks](https://moneymorning.com/category/article/stocks/) # Seagate Technology Just Got Added to the Nasdaq 100. Time to Buy?  by Rich Duprey  December 15, 2025  Share it: **Seagate Technology** ( [STX](https://moneymorning.com/stocks/stx/)) has been a standout performer in the **S&P 500** this year, with shares roughly tripling in value in 2025, delivering year-to-date gains of 233%. Only **Western Digital** ( [WDC](https://moneymorning.com/stocks/wdc/)) – its direct competitor in hard disk drives (HDD) – and the newly spun-off **SanDisk** ( [SNDK](https://moneymorning.com/stocks/sndk/)), a flash memory pure-play, have posted stronger returns among large-cap stocks. This remarkable rally has propelled STX into the spotlight, culminating in a major milestone: On Friday, **Nasdaq** announced Seagate will join the **Nasdaq-100 Index** as part of its annual reconstitution, with inclusion becoming effective Dec. 22. The addition alongside peers like Western Digital and four other stocks underscores the growing recognition of data storage leaders in the tech ecosystem. For investors, the question is, has this explosive run left STX overextended, meaning latecomers have missed the boat? Or does the stock still have meaningful upside as AI-driven demand accelerates?  ## The AI Storage Boom Fuels Seagate's Outperformance Seagate's surge has outpaced not just megacap tech giants like **Nvidia** ( [NVDA](https://moneymorning.com/stocks/nvda/)) and **Palantir Technologies** ( [PLTR](https://moneymorning.com/stocks/pltr/)) – which have delivered strong but comparatively modest gains amid broader AI enthusiasm – but nearly every other S&P 500 constituent. The key driver has been [explosive demand for high-capacity HDDs](https://moneymorning.com/2025/03/04/3-compelling-tech-dividend-stocks-that-are-trading-at-a-discount-mchp-stx-swks/) in AI data centers. While most attention has focused on GPUs and semiconductors, the reality is that training and running large language models generate massive datasets requiring cost-effective, high-density storage. Cloud hyperscalers like **Amazon** ( [AMZN](https://moneymorning.com/stocks/amzn/)), **Microsoft** ( [MSFT](https://moneymorning.com/stocks/msft/)), and Google are rapidly expanding infrastructure, prioritizing nearline and mass-capacity HDDs for archival and bulk storage needs. Seagate, as a leading HDD manufacturer, has been a direct beneficiary, reporting robust revenue growth – up over 30% in recent quarters – and sharply improved margins from disciplined pricing and supply management. Unlike flash-based SSDs, which dominate in speed-critical applications, HDDs excel in cost per terabyte for petabyte-scale storage, making them indispensable for AI workloads. Seagate's fiscal 2025 results reflected this shift, with enterprise and cloud segments driving the bulk of gains. Strong guidance and analyst upgrades further fueled momentum, as investors recognized storage as an underappreciated "picks and shovels" play in the AI gold rush. This structural tailwind has allowed STX to eclipse pure software AI names like PLTR and even chip leaders, highlighting how infrastructure hardware is capturing a larger share of AI spending. ## Index Inclusion and Passive Inflows Ahead The Nasdaq-100 addition is timely, expected to trigger significant buying from index-tracking funds like **Invesco QQQ Trust ETF** ( [QQQ](https://moneymorning.com/stocks/qqq/)), which manage hundreds of billions in assets. Historical precedents show additions often enjoy short-term boosts from forced inflows, potentially providing another catalyst for STX. Combined with ongoing cloud capex cycles, this positions Seagate favorably heading into 2026. ## Bottom Line STX has not run its course – there's still room for the next leg higher. Trading around 19x forward earnings with a PEG ratio of roughly 0.73 (based on consensus five-year EPS CAGR estimates near 27%), the stock remains attractively valued relative to its growth prospects. AI data explosion shows no signs of slowing, even as concerns about its sustainability grow. Seagate's market leadership in mass-capacity storage should sustain elevated demand. While volatility is likely in cyclical hardware, current metrics suggest STX is cheap for its trajectory. Investors can reasonably buy Seagate, eyeing potential re-rating as earnings visibility increases. **Beat the market, without relying on brokers or biased institutions.** Email(Required) Comments This field is for validation purposes and should be left unchanged. Subscribe By submitting your email address, you will receive a free subscription to _Money Morning!_ and occasional special offers from us and our affiliates. 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