TLDR
- SanDisk shares jumped 9.5% to $446.42 on Tuesday, extending 2026 gains to 88% in three weeks
- Citi raised price target to $490 from $280, keeping Buy rating as tight supply conditions persist
- The stock has surged 1,100% since splitting from Western Digital in February 2025
- Q2 earnings expected at $3.32 per share on January 29, nearly triple last year’s $1.23
- AI infrastructure needs and Nvidia’s Rubin chip platform are driving memory storage demand higher
SanDisk stock surged 9.5% Tuesday, closing at $446.42 and leading the S&P 500. The memory maker added another 1% after the bell.
The rally extends an extraordinary 2026 start for the data storage company. Shares have climbed 88% year-to-date, positioning SanDisk as one of the market’s hottest performers.
Citi analyst Asiya Merchant triggered the latest move by raising her price target. She increased it to $490 from $280 while keeping her Buy rating in place.
The five-star analyst maintains SanDisk on her firm’s short-term upside watch list. Investors will get fresh data when the company reports Q2 results on January 29.
Q2 Report Could Show Earnings Nearly Triple
Wall Street forecasts Q2 earnings of $3.32 per share for the upcoming report. That would mark a 170% jump from the $1.23 earned in the same quarter last year.
Analysts project revenue will hit $2.63 billion for the period. The company reports demand remains unconstrained, with growth tracking in the mid-20% range.
Merchant’s price target hike came within Citi’s 2026 technology hardware outlook report. The firm sees hyperscaler data center spending staying strong across key categories.
SanDisk stands to benefit as storage needs expand in data centers. Citi expects the favorable supply-demand balance to continue through 2027.
The company hasn’t changed its supply strategy despite volatile market conditions. Management is balancing short-term profit goals with long-term growth positioning.
AI Infrastructure Pushes Storage Requirements Higher
Nvidia’s Rubin chip has emerged as a key driver for memory stock interest. The processor architecture requires increased flash storage capacity in AI systems.
Nvidia showcased the chip’s storage platform at this month’s CES conference. The design adds more SSD requirements to AI infrastructure builds.
Morningstar analyst William Kerwin noted the implications for supply dynamics. “More SSD demand for these systems would imply even tighter supply than we have right now,” he said.
The ongoing shift from AI training to inferencing will sustain demand growth. Inferencing involves applying trained AI models to process data at scale.
Massive Gains Raise Valuation Concerns
SanDisk has rocketed over 1,100% since its Western Digital spinoff last February. The separation has created one of the market’s most impressive turnaround stories.
Only one other current S&P 500 stock has matched this January performance. Carvana gained 88% in January 2023, though it wasn’t part of the index at that time.
Analysts rate the stock as a Moderate Buy overall. The consensus includes 11 Buy ratings and four Hold ratings from the past three months.
The average price target of $357.53 sits roughly 20% below current levels. That gap highlights how quickly shares have outpaced analyst expectations.
Citi pointed out that other memory stocks might provide better risk-reward setups now. The firm prefers hard disk drive makers like Western Digital and Seagate Technology.
These companies could see more upside as drive pricing increases. Still, Citi keeps SanDisk on its watch list heading into the earnings release.
Limited supply capacity paired with strong AI infrastructure demand creates pricing power. The combination should support margin expansion and continued strong financial performance through 2027.
