Evercore ISI Raises Sandisk Price Target to $3,100

Evercore ISI analyst Amit Daryanani raised the price target on SanDisk (NASDAQ: SNDK) to $3,100 while maintaining an Outperform rating.

“We’re raising our revenue/EPS estimates on SNDK, along with our Target Price to $3,100, as we think investors are underappreciating the DURABLITY of SNDK’s EPS & FCF over next few years and further PRICING POWER as the supply/demand imbalance persists though CY26/27.

More importantly, we expect materially improved earnings visibility from SNDK’s recently signed New Business Model (NBM) agreements. Our updated model reflects committed revenues from five total NBMs: three signed in FQ3 totaling ~$42B of RPO, and two additional deals signed early in FQ4 with no disclosed RPO balance yet.

We estimate all five deals represent ~$62B of minimum committed revenue over the next several years, with >$11B of financial guarantees/prepayments that provide better visibility than SNDK has had before. With over ~1/3 of SNDK’s FY27 bits now tied to NBMs, at ~80%+ GMs, we expect SNDK will have a higher floor to forward EPS than was possible in the old spot-driven NAND model.

We’re modeling FY27 revs/EPS of $47.8B/$212.78 (vs. street at $47.9B/$203.33), with >20% of EPS coming from secured NBM agreements (~$46 in EPS). In our BULL scenario, we see FY27 EPS upside to >$300, with stock upside to ~$4,000 (on a ~13x P/E multiple).

Net/Net: While investors remain skeptical about the lasting impact of new long-term supply agreements being formed across the memory market, we believe they’re providing a structural shift in SNDK’s earnings visibility, as we estimate that >20% of SNDK’s FY27 EPS will be tied to LT supply agreements.

While upside in our model remains driven by torque from incremental NAND pricing, the NBMs allow investors to underwrite a larger portion of SNDK’s earnings than prior commodity cycles have allowed. Maintaining our OP and raising our target to $3,100 (~15x our new FY27 EPS estimate), with upside potential to $4,000.”

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