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[Updates with FYQ2 pre-announce at bottom of post.]

Shares of hard disk drive maker Seagate Technology (STX) have been on a tear today, apparently driven by a post this morning from ValueStreet Research on Seeking Alpha that claimed the company had made an investment in San Francisco-based startup Ripple, backers of one of the crypto currencies, “XRP,” an investment that could be worth as much as $7.8 billion to Seagate.

In addition, after hours, the company updated its outlook for the fiscal Q2 ended last month, offering a forecast for revenue that topped analysts' expectations, sending its shares still higher.

Seagate stock closed up $3.06, over 7%, at $46, though it backed off the highest level of the session, $49.70.

BTIG Research’s Edward Parker, who has a Buy rating on Seagate, notes the point raised by ValueStreet, to wit, Seagate invested in the Series A and Series B rounds for the startup, which were $28 million and $55 million rounds, respectively.

Parker writes that “While we aren’t certain how much capital Seagate invested nor how much, if any, XRP it owns, given Ripple’s recent meteoric rise, it is conceivable that Seagate is potentially holding a meaningful amount of value in the form of XRP."

Parker sees two potential positives. One is that with Ripple owning 61% of XRB, if Seagate were to hold 1% of Ripple, it would mean $1.5 billion in value.

More important, perhaps, "the investment “has significance, because it could pace Seagate as an early mover in terms of the practical application of blockchain technology."

For example, Seagate could “leverage the Ripple payment protocol to limit exchange rate risk incurred as part of conducting operations across its expansive global supply chain."

He quotes Seagate CFO Dave Morton saying in 2015 that "the ability to move its “operational cash globally in a free way that is transparent is very important to [Seagate].”

The jump in the stock is a bit overdone, thinks Parker:

If the surge in shares (+~$900 in market cap) today can be explained by the Ripple Effect, then we see the rise as potentially overdone because of the multitude of assumptions made in the Seeking Alpha report.

On a less enthusiastic note, Amit Daryanani of RBC Capital urges caution. Reiterating a Sector Perform rating on the stock, he sees this as a very volatile investment:

As per latest XRP price of $2.45, STX's stake is equivalent to ~$1.4B, which is over 10% of STX's market cap of ~$12B. While we think STX stock volatility will now increase given the investment in Ripple, we think any indirect cryptocurrency ownership should be discounted somewhat due to inherent volatility and liquidity concerns. XRP remains highly volatile and was down ~30% in last 24 hours. Due to these concerns we view STX's stake more as a call option on Ripple's ultimate potential as a blockchain-based payment system, and not a driver of near-term fundamentals […] The underlying cryptocurrency XRP shot up from $0.24 on 12/1/2017 to $2.72 on 12/30. For perspective, according to a Fortune article on 1/2, Ripple co-founder Chris Larsen's stake made him the 15th richest American tying with Steve Ballmer.

Update: In a press release after market close, Seagate said it now expects revenue of $2.9 billion in the quarter ended in December, higher than its prior forecast for 3% to 5% sales growth. That's also higher than Street consensus for $2.74 billion.

Seagate cited a record number of "exabytes" shipped, at 88. It said that represented disk drive shipments of 40 million, with an average capacity per drive of 2.2 terabytes.

In addition, the company said it has signed a "long-term" agreement to obtain supply of NAND flash from Toshiba (6502JP). Seagate said the deal "will provide continuity of NAND supply for Seagate’s current and future SSD product portfolio."

The deal is not entirely a surprise, given something had been expected by the Street after Western Digital (WDC), Toshiba's partner in flash, and Seagate's competitor in drives, settled a legal dispute with Toshiba last month.

The update has added to Seagate's gains, up another $1.40, or 3%, at $47.42, in late trading.

Correction: A prior version of this post mis-stated the name of the crypto currency Ripple is backing. It is XRP. My apologies for any confusion caused by the error.