5 Stocks Receiving a Massive Vote of Approval From Wall Street Analysts

03. Western Digital Corporation (NASDAQ:WDC)

Price Reaction after the Upgrade: +2.57 (+3.64%)

On April 5, Rosenblatt made a significant move by upgrading Western Digital Corporation (NASDAQ:WDC), a key player in the data storage industry. Rosenblatt’s upgrade to Buy from Neutral, accompanied by a raised price target of $115, reflects a bullish sentiment towards Western Digital Corporation (NASDAQ:WDC) prospects within the industry. The decision to upgrade Western Digital stems from Rosenblatt’s assessment of strengthening NAND Flash prices, a key component in the company’s product offerings. Industry data indicates a projected rise of 15% or more in NAND Flash average contract prices for the second quarter of 2024. This increase is being primarily driven by growing demand, low inventories, and disciplined capacity controls within the industry. Rosenblatt has adjusted its assumptions regarding NAND Flash Average Selling Prices (ASP) for the next four quarters and maintains a view of NAND Flash demand as price elastic. This suggests that demand for NAND Flash memory remains sensitive to changes in price, which bodes well for Western Digital Corporation (NASDAQ:WDC) revenue and profitability.

Furthermore, Rosenblatt anticipates limited new capacity expansions within the industry until gross margins reach the mid-30%. This expectation suggests a favorable supply-demand balance for Western Digital and its competitors in the near term, potentially leading to improved profitability and market positioning. With these factors in mind, Rosenblatt has revised Western Digital Corporation (NASDAQ:WDC) 12-month price target to $115, up from $65. This target is based on a multiple of 13 times their Next Twelve Months (NTM) Non-GAAP Earnings Per Share (EPS), indicating confidence in Western Digital Corporation (NASDAQ:WDC) growth potential and market performance over the coming year.