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Sandisk Hits 52-Week High: Should You Still Buy the Stock?
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Key Takeaways
SNDK hit a 52-week high of $1,600; shares have soared 552% YTD and closed at $1,547.56.
Sandisk said datacenter revenues jumped 233% sequentially in Q3'26 as AI SSD deployments ramped.
SNDK has authorized a $6B buyback, driven by strong liquidity and cash flow generation.
Sandisk (SNDK - Free Report) shares hit a 52-week high of $1,600 on May 11, eventually closing at $1,547.56. SNDK shares have jumped a whopping 552% year to date, comfortably outperforming the Zacks Computer Storage industry’s return of 226.3% and the Zacks Computer and Technology sector’s rise of 16.8%. The company has outperformed its storage peers, including Western Digital (WDC - Free Report) , Seagate (STX - Free Report) and Micron Technology (MU - Free Report) , over the same time frame, shares of which have returned 199.5%, 202.9% and 178.7%, respectively.
Will the momentum in Sandisk’s stock continue? Let us find out.
SNDK Stock’s Price Performance
Image Source: Zacks Investment Research
Strong Data Center Demand to Aid SNDK’s Prospects
Sandisk is benefiting from strong demand for NAND storage products, which has transitioned from a commodity, cyclical market to a strategic, AI-driven infrastructure layer. The company’s datacenter revenues surged 233% sequentially in the third quarter of fiscal 2026 as hyperscalers and enterprise customers increased deployments of high-performance enterprise SSDs for AI workloads.
Management believes NAND flash is becoming a critical component of AI infrastructure as larger AI models, KV cache requirements and retrieval-augmented generation workloads require massive amounts of high-performance storage.
Sandisk is benefiting from its technology leadership in BiCS8 NAND and an expanding QLC product portfolio. The company’s strategic partnerships with Kioxia and Nanya are expected to drive top-line growth. Sandisk extended its joint venture with Kioxia through December 2034 and is investing approximately $1 billion in Nanya to secure long-term DRAM supply.
The company is undergoing a structural transformation that could significantly reduce the historical cyclicality of the NAND industry. Sandisk has already signed five multi-year New Business Model (NBM) agreements, backed by firm financial guarantees exceeding $11 billion, with more than one-third of fiscal 2027 bits already under long-term commitments.
The above-mentioned agreements provide supply assurance to customers while improving revenue visibility, pricing stability and earnings durability for Sandisk. Management noted that the contracts could extend up to five years and are designed to support more predictable long-term returns.
SNDK Offers Positive Q4 Guidance
For the fourth quarter of fiscal 2026, Sandisk expects non-GAAP revenues between $7.75 billion and $8.25 billion. The gross margin is anticipated to be 79% to 81% (suggesting a rise from the 78.4% reported in the third quarter of fiscal 2026), while earnings are expected between $30.00 and $33.00 per share.
In this context, Western Digital expects a non-GAAP gross margin of 51-52% (indicating a rise from 50.5% in the fiscal third quarter) and non-GAAP earnings of $3.25 (plus or minus 15 cents) per share for the fourth quarter of fiscal 2026. Seagate expects non-GAAP earnings of $5 per share (plus or minus 20 cents) for the fourth quarter of fiscal 2026. Micron expects a non-GAAP gross margin of 81% and earnings of $19.15 (plus or minus 40 cents) for the same time frame.
The Zacks Consensus Estimate for Sandisk’s fourth-quarter fiscal 2026 earnings is pegged at $32.40 per share, up 76% over the past 30 days. Sandisk reported earnings of 29 cents per share in the year-ago quarter. The consensus mark for fourth-quarter fiscal 2026 revenues is pegged at $8.01 billion, suggesting 321.3% growth from the figure reported in the year-ago quarter.
Sandisk’s balance sheet and capital allocation strategy strengthen its investment case. The company ended the quarter with $3.74 billion in cash and fully repaid its remaining debt balance, giving it a net cash position.
The company has authorized a massive $6-billion share repurchase program, signaling confidence in SNDK’s long-term outlook and cash-generation capabilities. Cash flow from operations was $3.04 billion in the third quarter of fiscal 2026, with the gross capital expenditure of $240 million that represented 4% of revenues. The company stated that its capital expenditure plan is balancing growth opportunities and generating attractive returns while supporting its ongoing BiCS8 transition.
Sandisk Stock Trades at a Premium
SNDK shares are trading at a premium, as suggested by a Value Score of F.
In terms of the forward 12-month price-to-sales (P/S), Sandisk is trading at 5.97X, higher than the industry’s 3.96X and Micron’s 5.73X. However, the company is trading at a lower P/S multiple compared with Western Digital’s 10.63X and Seagate’s 12.37X.
SNDK Stock’s Valuation
Image Source: Zacks Investment Research
Conclusion
Sandisk is benefiting from strong AI-driven demand for NAND that is supporting Data Center revenues. Demand-supply imbalance, as well as shift toward premium configuration devices in edge and consumer end-markets, bodes well for the company’s prospects. These factors are expected to push the stock upward and justify a premium valuation.
Sandisk currently sports a Zacks Rank #1 (Strong Buy) and has a Growth Score of A, a favorable combination that offers a strong investment opportunity, per the Zacks Proprietary methodology. You can see the complete list of today’s Zacks #1 Rank stocks here.
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Sandisk Hits 52-Week High: Should You Still Buy the Stock?
Key Takeaways
Sandisk (SNDK - Free Report) shares hit a 52-week high of $1,600 on May 11, eventually closing at $1,547.56. SNDK shares have jumped a whopping 552% year to date, comfortably outperforming the Zacks Computer Storage industry’s return of 226.3% and the Zacks Computer and Technology sector’s rise of 16.8%. The company has outperformed its storage peers, including Western Digital (WDC - Free Report) , Seagate (STX - Free Report) and Micron Technology (MU - Free Report) , over the same time frame, shares of which have returned 199.5%, 202.9% and 178.7%, respectively.
Will the momentum in Sandisk’s stock continue? Let us find out.
SNDK Stock’s Price Performance
Image Source: Zacks Investment Research
Strong Data Center Demand to Aid SNDK’s Prospects
Sandisk is benefiting from strong demand for NAND storage products, which has transitioned from a commodity, cyclical market to a strategic, AI-driven infrastructure layer. The company’s datacenter revenues surged 233% sequentially in the third quarter of fiscal 2026 as hyperscalers and enterprise customers increased deployments of high-performance enterprise SSDs for AI workloads.
Management believes NAND flash is becoming a critical component of AI infrastructure as larger AI models, KV cache requirements and retrieval-augmented generation workloads require massive amounts of high-performance storage.
Sandisk is benefiting from its technology leadership in BiCS8 NAND and an expanding QLC product portfolio. The company’s strategic partnerships with Kioxia and Nanya are expected to drive top-line growth. Sandisk extended its joint venture with Kioxia through December 2034 and is investing approximately $1 billion in Nanya to secure long-term DRAM supply.
The company is undergoing a structural transformation that could significantly reduce the historical cyclicality of the NAND industry. Sandisk has already signed five multi-year New Business Model (NBM) agreements, backed by firm financial guarantees exceeding $11 billion, with more than one-third of fiscal 2027 bits already under long-term commitments.
The above-mentioned agreements provide supply assurance to customers while improving revenue visibility, pricing stability and earnings durability for Sandisk. Management noted that the contracts could extend up to five years and are designed to support more predictable long-term returns.
SNDK Offers Positive Q4 Guidance
For the fourth quarter of fiscal 2026, Sandisk expects non-GAAP revenues between $7.75 billion and $8.25 billion. The gross margin is anticipated to be 79% to 81% (suggesting a rise from the 78.4% reported in the third quarter of fiscal 2026), while earnings are expected between $30.00 and $33.00 per share.
In this context, Western Digital expects a non-GAAP gross margin of 51-52% (indicating a rise from 50.5% in the fiscal third quarter) and non-GAAP earnings of $3.25 (plus or minus 15 cents) per share for the fourth quarter of fiscal 2026. Seagate expects non-GAAP earnings of $5 per share (plus or minus 20 cents) for the fourth quarter of fiscal 2026. Micron expects a non-GAAP gross margin of 81% and earnings of $19.15 (plus or minus 40 cents) for the same time frame.
The Zacks Consensus Estimate for Sandisk’s fourth-quarter fiscal 2026 earnings is pegged at $32.40 per share, up 76% over the past 30 days. Sandisk reported earnings of 29 cents per share in the year-ago quarter. The consensus mark for fourth-quarter fiscal 2026 revenues is pegged at $8.01 billion, suggesting 321.3% growth from the figure reported in the year-ago quarter.
Sandisk Corporation Price and Consensus
Sandisk Corporation price-consensus-chart | Sandisk Corporation Quote
Strong Liquidity Boosts SNDK’s Investment Profile
Sandisk’s balance sheet and capital allocation strategy strengthen its investment case. The company ended the quarter with $3.74 billion in cash and fully repaid its remaining debt balance, giving it a net cash position.
The company has authorized a massive $6-billion share repurchase program, signaling confidence in SNDK’s long-term outlook and cash-generation capabilities. Cash flow from operations was $3.04 billion in the third quarter of fiscal 2026, with the gross capital expenditure of $240 million that represented 4% of revenues. The company stated that its capital expenditure plan is balancing growth opportunities and generating attractive returns while supporting its ongoing BiCS8 transition.
Sandisk Stock Trades at a Premium
SNDK shares are trading at a premium, as suggested by a Value Score of F.
In terms of the forward 12-month price-to-sales (P/S), Sandisk is trading at 5.97X, higher than the industry’s 3.96X and Micron’s 5.73X. However, the company is trading at a lower P/S multiple compared with Western Digital’s 10.63X and Seagate’s 12.37X.
SNDK Stock’s Valuation
Image Source: Zacks Investment Research
Conclusion
Sandisk is benefiting from strong AI-driven demand for NAND that is supporting Data Center revenues. Demand-supply imbalance, as well as shift toward premium configuration devices in edge and consumer end-markets, bodes well for the company’s prospects. These factors are expected to push the stock upward and justify a premium valuation.
Sandisk currently sports a Zacks Rank #1 (Strong Buy) and has a Growth Score of A, a favorable combination that offers a strong investment opportunity, per the Zacks Proprietary methodology. You can see the complete list of today’s Zacks #1 Rank stocks here.