Following Toshiba's announcement of production expansion, which led to a sharp decline in the stock prices of Seagate (STX) and Western Digital (WDC), Morgan Stanley analysts Erik W. Woodring and his team conducted channel checks and arrived at a completely opposite conclusion. They believe the market has significantly overestimated the scale of Toshiba's expansion, and that HDD demand is accelerating with spot prices surging. The firm reiterated its "Overweight" rating on both stocks, naming Seagate as its top pick, with target prices of $1187 and $676 respectively, representing an upside of approximately 40% and 64% from Friday's closing prices.