SanDisk Corporation (SNDK) shares kept sliding Thursday as traders cashed in on the AI hardware and memory chip rally that's been running for months. The stock was down 7.85% in premarket trading at $1,488.20, following a drop on Wednesday.
The pullback comes as no surprise after a blistering multi-month run, but there's a specific catalyst adding pressure: news that Chinese memory maker ChangXin Memory Technologies (CXMT) filed for a nearly $10 billion initial public offering in Shanghai. That's a reminder that competition in the semiconductor space is heating up, and investors are taking some chips off the table.
Wall Street Still Sees Upside
Despite the recent weakness, analysts aren't running for the exits. In fact, they've been raising price targets over the past few weeks.
On July 1, Bank of America analyst Wamsi Mohan reiterated a Buy rating and boosted his price target to $2,500 from $2,100. Mohan believes tight NAND supply and demand conditions could persist through 2027, with pricing staying resilient at least through mid-2027.
Evercore ISI went even further, maintaining an Outperform rating and lifting its target to $3,100 from $1,400. The firm pointed to the durability of SanDisk's earnings and free cash flow, projecting that NAND supply-demand imbalances will last through 2026 and 2027.
Citigroup reiterated a $2,500 price target on June 25, citing sustained AI-driven demand. Bernstein raised its target to $3,000 on June 30, highlighting SanDisk's long-term enterprise SSD supply agreements.
Earnings on Deck
SanDisk is scheduled to report quarterly results on Aug. 5. Wall Street expects earnings of $33.38 per share on revenue of $8.24 billion. For context, in the same quarter last year, the company reported earnings of just 29 cents per share on revenue of $1.90 billion. That's a staggering year-over-year jump, driven by the AI boom and memory cycle upswing.
The stock trades at about 60.1 times earnings and carries a consensus Buy rating.
Technical Check: Pullback or Breakdown?
From a trend perspective, SanDisk is still in a longer-term uptrend, but the near-term setup is under pressure. The stock is trading 22.4% below its 20-day simple moving average (SMA) of $1,936.21 and 12.7% below its 50-day SMA of $1,722.23. At the same time, it remains 21% above its 100-day SMA ($1,242.56) and 95.5% above its 200-day SMA ($768.96). That's why longer-term bulls see this as a pullback inside a bigger uptrend rather than a broken chart.
The moving-average structure is mixed but still constructive on higher timeframes, with the 20-day SMA above the 50-day SMA and the 50-day SMA above the 200-day SMA.
- Key Resistance: $1,600
- Key Support: $1,485
With earnings just a few weeks away and analysts firmly in the bullish camp, the next few trading sessions could set the tone for whether this dip becomes a buying opportunity or something more serious.
