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Western Digital Stock Plunges 16%

June 22, 1989|DAVID OLMOS

Western Digital Corp. stock was off sharply Wednesday for the second consecutive day in very active trading.

Western Digital's shares have tumbled 16% the past two days to their lowest level in the past three years.

Analysts said the Irvine computer products company has made no public announcement that would explain the decline. Company officials could not be reached for comment Wednesday.

On Wednesday, the stock closed off 75 cents to $9 per share on the American Stock Exchange. It was the fourth most actively traded Amex listing, with 458,000 shares changing hands.

The stock has fallen out of favor with some Wall Street analysts since the company reported poor third-quarter results. The company has been hurt by slowing sales of its main product lines.

For its third quarter ended March 30, Western Digital's earnings plunged 46% to $4.4 million, while revenue declined 7% to $243 million.

Earlier this year, the company laid off 12% of its worldwide work force--or about 950 employees.

Western Digital manufactures a wide variety of components such as semiconductors, disk drive controllers and data storage devices that are used in the personal computer industry.

The Irvine firm has been hurt by slowing sales of its disk controllers, which have not been included in many of the top-selling PCs made by IBM, Compaq and Apple.

Karen Payne, an analyst at the Philadelphia investment firm Butcher & Singer Inc., forecast last month that Western Digital's sales and earnings would probably tumble for the next several quarters.

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