SanDisk stock price target raised to $230 from $125 at BofA Securities

Investing.com - BofA Securities has significantly raised its price target on SanDisk (NASDAQ:SNDK) to $230 from $125 while maintaining a Buy rating on the stock. SanDisk shares are currently trading at $194.57, after delivering an impressive 440% return year-to-date and reaching a 52-week high of $213.40 recently. According to InvestingPro data, the stock appears overvalued compared to its Fair Value estimate.

The firm cited stronger-than-expected demand from data centers that is meaningfully impacting pricing as one of the key factors behind the substantial price target increase.

BofA Securities also pointed to an expected medium-term undersupply of HDDs driving higher demand for eSSD products, along with growing confidence in SanDisk’s increasing penetration of the eSSD market.

The firm noted that NAND suppliers show low appetite to increase capacity in the near term, which supports the positive outlook for SanDisk.

BofA Securities expects SanDisk’s price to book value multiple to rerate from 0.8x-2x to 3x-4x over the next few years, driven by higher revenue growth with all-time high profitability levels. InvestingPro data shows SanDisk’s current P/B ratio is 3.09x, with the company receiving a "GOOD" overall financial health rating. For deeper insights and comprehensive analysis on SanDisk and 1,400+ other US equities, check out the Pro Research Report available on InvestingPro.

In other recent news, SanDisk has seen a series of price target increases from various analyst firms, reflecting positive sentiment in the market. Morgan Stanley raised its price target for SanDisk to $230 from $96, maintaining an Overweight rating, while Jefferies increased its target to $180 from $60, citing an improved pricing outlook and the rapid proliferation of multimodal large language models. Benchmark also raised its price target to $125 from $85, attributing the increase to anticipated NAND price hikes by competitors like Samsung. Mizuho has adjusted its target to $112 from $57, highlighting improvements in the NAND and enterprise SSD market. These upgrades come as the company prepares for its upcoming earnings report, with analysts expecting favorable financial results. The focus on NAND pricing and market demand, especially from hyperscalers, appears to be driving these optimistic revisions. Notably, Morgan Stanley had previously set a target of $96 based on AI demand, which has now been raised significantly. Each firm maintains a positive outlook, with ratings such as Overweight, Buy, and Outperform, indicating confidence in SanDisk’s future performance.

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