Brean Murray Carret's Computer Hardware Update (STX, WDC)

Brean Murray Carret is out with its computer hardware update, which highlights Seagate Technology (NASDAQ: STX), and Western Digital Corp. (NYSE: WDC).

In a note to clients, BMC writes, "We continue to believe that drive pricing and investor sentiment remain the key to drive stocks in the near‐term; and while we believe pricing remains stable, ongoing “noise” regarding PC demand and the potential impact to Mar Q drive shipments has weighed on the stocks. We expect this push‐pull dynamic with the stocks to continue into the Jun Q until there is increased visibility into 1) what secular 2011 PC demand in shaping up to be and 2) the real impact and shipment timing of Intel's chipset quality issues; stable pricing promotes healthy gross margins, and along with margin expansion opportunities from 2H product ramps we continue to like both WDC and STX at these levels."

BMC maintains Buy on STX and WDC. BMC has an $18 PT on STX, and a $40 PT on WDC.

Shares of STX closed Tuesday at $12.29.

Shares of WDC closed Tuesday at $29.44, down 3.73% from Monday's close.