One of the year’s biggest disappointments has to be Seagate Teachnology. The high-tech heavyweight is taking on so much water that barnacles are starting to grow on its bottom line.

Hey . . . at least something is growing on Seagate’s bottom line.

Before I get into Seagate’s woes, I realize that the industry is sluggish right now and that consumers are holding tight praying for a better economic picture in 2009. That’s certainly the case of late. According to Forbes.com, 30% of U.S. companies slashed their technology budgets in the third quarter of 2008. Another 29% say they will do the same in Q4, Forbes adds. We’ve already seen the ramifications of lower tech spending this year, with big guns like Hewletter-Packard and Dell reporting reductions in corporate spending while explaining why their quarterly numbers are written in red ink rather than black.

That’s not to exonerate Seagate, which has been a disaster for its investors this year. Through early September, the company’s stock has declined a whopping 45% since January 1, 2008. Insiders have been selling the stock in increasingly high numbers, and no insiders that I can find are buying much of it up. Obviously, when company insiders are baling out, you have a big red flag that can be seen all the way from Wall Street. It’s also a sign that we should see more trouble ahead for Seagate’s stock. I’ve seen some analysts who believe that Seagate is an anomaly and that the stock should be set to rise (it’s currently trading at around $13 per share).

The company’s fundamentals seem encouraging. The company has solidified its product shipping numbers, with a 21% growth rate in shipments to 5.2. million units in 2008. Seagate still seems to excel in the desktop market, with shipments up 6% to 25.4 million units. In the consumer electronics sector, with product shipments rising 11% to 5.7 million. Plus, the company has said it will soon start shipping the industry’s first 7200 RPM 320-gigabyte notebook drive to a major OEM.

Seagate chief executive officer Bill Watkins has been out front in recognizing that the company has its problems – but he’s bullish on 2009. In July, he told analysts “We focused considerable effort over the past few quarters, successfully getting our product execution back on track, particularly in the notebook arena, where we have lost some of the first mover advantage we have historically enjoyed. (But) we are gaining traction now with a new product lineup that will serve all markets, including the notebook market, and we expect to see significant improvement in Seagate’s performance in the December quarter and continue that throughout the remainder of fiscal year 2009.”

Seagate apparently feels that it’s well positioned to post gains in the enterprise storage (more likely) and notebook markets (jury is still out). With demand stronger in enterprise computing, at least Seagate - and its investors – have something to hang their hats on to.