Sandisk Corporation (SNDK) is having a moment. After a monster 25.99% surge in the previous session, shares are up another 5% in Friday's premarket. The catalyst? A broad risk-on tone sweeping through markets, with Nasdaq futures climbing 1.38% and S&P 500 futures up 0.55%. Investors are piling back into higher-beta tech names, and Sandisk is riding that wave.
But there's more to the story than just market mood. Sandisk's quarterly earnings are scheduled for Aug. 5, less than a week away. With that catalyst looming, traders are zeroing in on key technical levels after the stock's pullback from its June highs.
Technical Analysis: A Tale of Two Trends
Here's the technical picture: Sandisk is still 11.3% below its 20-day simple moving average (SMA) and 20.5% below its 50-day SMA. That suggests the intermediate trend is under pressure, even with Friday's bounce. But zoom out, and the story changes. The stock sits 2.7% above its 100-day SMA and a whopping 62.6% above its 200-day SMA, so the longer-term uptrend is very much intact.
The moving averages themselves are sending mixed signals. The 20-day SMA is below the 50-day SMA, a bearish crossover that often signals a cooling phase after a strong rally. Meanwhile, the 50-day SMA remains above the 200-day SMA, which supports the bullish long-term view. Momentum indicators are also mixed: the MACD is below its signal line with a negative histogram, suggesting upside momentum has weakened. Buyers need to step up to strengthen the rally.
Key levels to watch:
- Resistance: $1,600, near the 50-day SMA.
- Support: $1,325, which aligns closely with the 100-day SMA.
Earnings Preview: The Big Show
Sandisk reports quarterly results on Aug. 5. Wall Street is expecting earnings of $33.38 per share, a staggering jump from 29 cents a year earlier. Revenue is projected at $8.24 billion, compared with $1.90 billion last year. That's a massive growth story, and it explains why the stock trades at about 43.7 times earnings, a premium valuation.
Analysts are bullish, with a Buy consensus and an average price target of $2,031.69. Recent rating actions include:
- Susquehanna: Positive, lowered price target to $3,050 (July 23).
- Wells Fargo: Equal Weight, raised price target to $1,620 (July 22).
- Bank of America Securities: Buy, raised price target to $2,500 (July 1).
Momentum vs. Value: The Rankings
Sandisk's momentum score is off the charts at 99.92, reflecting strong long-term price performance despite the recent pullback. But its value score is just 10.01, meaning the stock isn't cheap relative to the broader market. This is a momentum-driven name, and its next move likely hinges on whether it can reclaim key moving averages and deliver another blowout earnings report.
ETF Exposure: The Ripple Effect
Sandisk is a meaningful holding in several exchange-traded funds, which can amplify trading activity:
- Roundhill Memory ETF (Roundhill Memory ETF (DRAM)): 5.42%
- Pacer U.S. Large Cap Cash Cows Growth Leaders ETF (Pacer U.S. Large Cap Cash Cows Growth Leaders ETF (COWG)): 4.63%
- Invesco S&P 500 Pure Growth ETF (Invesco S&P 500 Pure Growth ETF (RPG)): 7.29%
Because of these relatively large weightings, fund inflows and outflows can influence the stock's price action.
Price Action
As of Friday premarket, Sandisk shares were up 4.72% at $1,340.34, according to market data.
