Nucor earnings beat by $0.08, revenue fell short of estimates
On Thursday, JPMorgan reinstated coverage on Western Digital Corp. (NASDAQ: WDC), upgrading the stock from a Neutral to an Overweight rating and raising the price target to $57.00 from $45.00. The firm’s decision comes after Western Digital successfully separated its NAND flash business in February, positioning itself as a pure-play hard disk drive (HDD) provider. The stock, currently trading at a P/E of 13.35x with a market cap of $15.26B, has shown strong momentum with a 9.19% gain last week. According to InvestingPro analysis, Western Digital appears undervalued compared to its Fair Value, making it an interesting addition to the most undervalued stocks watchlist.
The upgrade reflects Western Digital’s focus on advancing HDD technology to support the growing storage demands of data centers and cloud computing. The company reported strong financial results for the March quarter, with revenue, margins, and earnings per share surpassing consensus expectations. This performance was driven by robust demand from cloud and hyperscale customers. InvestingPro data shows the company maintains a healthy current ratio of 1.56 and has received a "GOOD" overall Financial Health Score, though 8 analysts have recently revised their earnings expectations downward for the upcoming period.
For the upcoming June quarter, Western Digital has guided revenues to $2.45 billion, which is a 7% increase quarter over quarter and higher than the consensus estimate of $2.36 billion. The company’s management has indicated that they have not seen any direct impact from tariffs, though they have incorporated a conservative approach in their revenue outlook for the June quarter to account for potential demand challenges in enterprise, consumer, and retail sectors due to tariff and trade-related dynamics.
Western Digital continues to experience strong exabyte demand from its cloud and hyperscaler customers. The company’s management highlighted that long-term agreements (LTAs) are providing greater visibility, with LTAs from large hyperscaler customers extending through the first half of calendar year 2026.
In other recent news, Western Digital Corporation (NASDAQ:WDC) reported third-quarter fiscal year 2025 earnings that exceeded analyst expectations. The company achieved an earnings per share of $1.36, significantly surpassing the forecasted $0.79. Despite falling short of the anticipated revenue of $3.86 billion, Western Digital’s revenue still marked a 31% year-over-year increase, reaching $2.3 billion. A notable 87% of this revenue was attributed to cloud storage. The company also announced the launch of new high-capacity storage platforms, indicating ongoing innovation in their product offerings.
Additionally, Western Digital provided guidance for the fourth quarter of fiscal year 2025, projecting revenue in the range of $2.45 billion, with a gross margin expected between 40-41%. The firm anticipates sequential revenue growth, driven by demand in the data center sector. On the financial front, Western Digital declared a quarterly dividend of $0.10 per share, reflecting confidence in its long-term cash-generating ability. The company also redeemed $1.8 billion of its 2026 senior notes, further strengthening its balance sheet. These developments underscore the company’s strategic focus and adaptability in a dynamic market environment.
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