Raymond James Upgrades Sandisk to Outperform, $725 Price Target

Raymond James analyst Melissa Fairbanks upgraded SanDisk (NASDAQ: SNDK) from Market Perform to Outperform with a price target of $725.

“In arguably one of the most delayed upgrades in history, we are upgrading Sandisk to Outperform from Market Perform and setting a price target of $725. Even after the recent move – up more than 16x (sixteen times, not percent) since the spin-off from Western Digital a year ago – we see opportunities for further upside, not surprisingly driven by the demand and pricing implications of an unprecedented datacenter/AI cycle.

We also arguably can’t accurately predict revenue or earnings against the backdrop of guidance for 57% upside in revenue versus current consensus, and an EPS beat of 2.5x expectations (note, we’ve said the same for MU).

That said, we know demand is exceptionally strong and likely only growing, supply is tightening to the point of potentially being sold out for years, and we see limited new supply coming online in the near term – supporting continued strong (an understatement) pricing going forward.

Net, while we have favored the DRAM suppliers recently, we now see a sustainably more favorable environment for NAND as well, and as such view SNDK as a key beneficiary of a mix-shift toward longer-lived datacenter builds, prioritizing supply away from higher-velocity edge/consumer.”

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