Overview
- The stock jumped roughly 15% in one session on Monday after JPMorgan and Morgan Stanley raised their price targets to $650, sending Western Digital to new 52‑week and all‑time highs.
- Western Digital reported a fiscal third quarter that topped expectations with adjusted EPS of $2.72 and $3.34 billion in revenue, and management issued stronger revenue guidance for the coming quarter.
- The company has increased shareholder returns and cut leverage by adding $4 billion to its buyback program and selling about $3.17 billion of its SanDisk stake to pay down debt.
- Analysts say the rally rests on an AI storage thesis that could leave HDD supply 10–15% short of demand in 2026 as AI workloads push annual HDD demand growth toward 40–50%, while manufacturers expand capacity more slowly.
- Key risks include high valuation and execution challenges in scaling next‑generation high‑capacity drives, and investors will be watching upcoming results and product roadmaps for evidence that demand and pricing hold.