So, SanDisk is certainly making the correct moves to expand its business and if this stock is still not on your radar, then it’s not too late to jump in now. But wait, let me give you one more reason why I think you should buy SanDisk Corporation (NASDAQ:SNDK).
Riding smartphone growth
Selling flash memory cards and embedded memory for smartphones is a big business for SanDisk. Management stated over the previous conference call that 900 million smartphones are expected to be shipped this year along with 200 million tablets. In addition, the company is also counting on smartphone growth in China and expects its products to sell well in the region.
Also, SanDisk expects growth in sales of expandable memory cards as many OEMs are including a memory slot on their phones. SanDisk Corporation (NASDAQ:SNDK)’s new 64 GB micro SD card is among the fastest out there as the company looks to tap this trend. And as far as embedded solutions are concerned, a slot in Apple Inc. (NASDAQ:AAPL)’s upcoming iPhone should drive revenue higher as well.
SanDisk had landed a spot in the iPhone 5, supplying flash memory to Apple for the device. The solid bump in revenue in the previous quarter was probably a result of Apple getting ready to ramp up production and reports suggest that the iPhone is already in production according to leaked images (via 9to5mac). But there’s more to the Apple Inc. (NASDAQ:AAPL) story, as it is purported that Apple is also preparing a lower cost option for the emerging markets.
While a cheaper iPhone would probably help Apple Inc. (NASDAQ:AAPL) unlock the emerging market code and also make its presence felt in China, it would also help SanDisk to sell more of its flash memory if it manages to land a spot in the cheaper version.
Final words
SanDisk Corporation (NASDAQ:SNDK) is growing at a terrific speed and has got some solid tailwinds behind it. As such, even though the stock trades at a seemingly expensive 31 times earnings, I think that its rapid earnings and revenue growth is enough to justify this premium. Hence, if you’re still on the sidelines regarding SanDisk, I think it would make sense to jump in as the fundamentals tell me that the journey north is set to continue.
The article A High-Flying Stock That Your Portfolio Should Have originally appeared on Fool.com and is written by Harsh Chauhan.
Harsh Chauhan has no position in any stocks mentioned. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple Inc. (NASDAQ:AAPL). Harsh is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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