SanDisk seen as a core beneficiary of NAND recovery; Bernstein raises target price to $1,000

　　SanDisk has just received one of the most aggressive bullish endorsements from Wall Street.

　　Bernstein—Société Générale Group analyst Mark C. Newman has significantly raised the target price for this storage chip company to $1,000, while maintaining an "outperform" rating.

　　This new target price is a 72.4% increase from the previous $580 target, and still offers about 50% upside compared to the current share price of $665.

　　For reference, this is currently the highest target price given by Wall Street, while the market consensus target price has only shown moderate upside after SanDisk's share price surged sharply earlier.

　　Recently, storage chip stocks have continued to soar, with fundamentals and stock prices of companies including Micron, SK Hynix, and Samsung all rising significantly.

　　This strong momentum has largely stemmed from a severe supply-demand imbalance in storage chips, as AI-driven hyperscale cloud computing enterprises continue to generate excess demand. However, after the substantial rally, valuations of many AI storage concept stocks are already at high levels.

　　For example, Micron's current price-to-sales ratio is about 11.6 times its sales over the past 12 months. By contrast, some companies in the storage sector are valued much lower, such as SanDisk, whose price-to-sales ratio is only 3.2 times.

　　Timing is extremely important, especially after the recent correction in precious metals, as the market is looking for a new narrative, and SanDisk happens to provide just that.

　　This particular timing is crucial—the recent pullback in the precious metals market has left investors urgently seeking a new investment theme, and SanDisk has become exactly that.

　　SanDisk's Impressive Quarterly Results Highlight Strong NAND Flash Industry Recovery

　　SanDisk's latest quarterly results have exceeded expectations across the board, forcing analysts to completely reassess the company's earnings growth trajectory.

　　This quarter, the company reported revenue of $3.03 billion, up 61% year-on-year and 31% quarter-on-quarter; profitability also improved significantly, with GAAP net profit of $803 million and earnings per share of $5.15; non-GAAP earnings per share soared to $6.20, a sharp increase from $1.23 a year ago.

　　In addition, the company's non-GAAP gross margin surged to 51.1%, rising 21.2 percentage points quarter-on-quarter and 18.6 percentage points year-on-year. This figure highlights that, thanks to higher product pricing, optimized product structure, and improved capacity utilization, the company achieved excellent operating leverage.

　　SanDisk's core performance data for the quarter:

　　Revenue: $3.03 billion (YoY +61%, QoQ +31%)

　　Non-GAAP EPS: $6.20 (Market expectation: $3.33)

　　Gross margin: 51.1% (significant increase both QoQ and YoY)

　　Data center business revenue: $440 million (QoQ +64%, YoY +76%)

　　Behind these outstanding results lies the company's ongoing product mix optimization and steady growth in enterprise SSD shipments, with data center business demand standing out—AI infrastructure clients are expanding their computing power while simultaneously ramping up storage device deployments.

　　SanDisk CEO David Goeckeler sent a signal to investors that accurately captured this industry shift: "We are negotiating with customers to move collaboration models from quarterly price negotiations to signing multi-year agreements with clear supply and pricing commitments."

　　Newman praised SanDisk's quarterly results as "significantly beating expectations, with impressive guidance, kicking off the Year of the Dragon perfectly." Based on the current "extremely strong product pricing environment," he raised the company's target price. At the same time, he also raised his non-GAAP EPS forecasts for SanDisk to $38.92 for fiscal 2026 and $90.96 for fiscal 2027, 188% higher than market consensus, an astonishing increase.

　　SanDisk also provided guidance: revenue for Q3 2026 is expected to be in the range of $4.4 billion to $4.8 billion, non-GAAP EPS is expected to be between $12 and $14, and gross margin could reach a high of 65% to 67%. In contrast, Micron's current gross margin is only about 45%, demonstrating just how impressive SanDisk's gross margin level is.

　　Why This Storage Cycle Means Something Different for SanDisk?

　　SanDisk occupies a unique and highly advantageous track in the storage chip sector.

　　After its spin-off from Western Digital, SanDisk became a pure-play company focused on NAND flash and storage products. Unlike other major storage chip players, the company does not depend entirely on the capital-intensive high-bandwidth memory (HBM) arms race.

　　Although the AI boom is an important driver for the company's business growth, SanDisk is also covering the full spectrum of NAND flash-related products, including consumer and enterprise SSDs, embedded flash, and removable storage devices. Product prices in this sector plummeted in 2023–2024, but are now experiencing a strong rebound.

　　Looking back at industry trends, TrendForce once predicted that the average selling price of NAND flash would fall nearly 15% quarter-on-quarter in Q1 2023, dragging industry revenue down 16.1% QoQ; in Q4 2024, NAND flash contract prices still fell 3%–8%, and the industry downturn persisted. But the turning point appeared in the second half of 2025—TrendForce data shows that NAND flash contract prices rose 5%–10% QoQ in Q3, and again by 5%–10% QoQ in Q4.

　　Recently, TrendForce further raised its outlook for Q1 2026, predicting that NAND flash contract prices will increase by more than 55%–60% QoQ, confirming the industry's recovery momentum.

　　SanDisk Is the Best Bet on NAND Flash Recovery

　　This is the core reason why SanDisk has become the purest play for the classic cyclical rebound in storage chips— as NAND flash prices bottom out and rebound, the company's revenue and profits have both seen a significant upswing.

　　SanDisk's current outperformance stems from three key advantages:

　　Pure-play NAND flash focus: The company is not involved in DRAM or HBM, so it is not affected by volatility in other segments, and the benefits of a pricing recovery are directly reflected in its strong fundamentals;

　　Lower operational execution risk: There is no need to compete for HBM market share, nor to continuously defend large-scale AI-related capital expenditures;

　　Market expectations have been reset: Previously, the company's share price was priced for industry distress, not perfect results, making this core NAND flash recovery target a low-exposure pick for institutions, now attracting significant capital attention.

Editor: Chen Yujia