SanDisk (SNDK) Stock: Earnings Beat Was Just the Beginning of This Rally – Here’s Why

TLDR

• SanDisk stock jumped 7% after reporting second-quarter earnings that beat expectations and issuing strong guidance for Q3 with over 52% sequential revenue growth
• Raymond James upgraded SNDK to Buy with a $725 price target, calling it “arguably one of the most delayed upgrades in history” as the stock has rallied 143% year-to-date
• Multiple analysts raised price targets, with Morgan Stanley boosting to $690 and RBC Capital increasing to $650, citing extreme NAND supply tightness driving unprecedented pricing growth
• SanDisk posted Q2 earnings of $6.20 per share, crushing estimates of $3.49, while revenue hit $3.03 billion versus projected $2.67 billion
• Analysts expect NAND supply constraints to persist through 2026, with pricing potentially up 60% or more sequentially as supply tightens to near sold-out levels

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SanDisk stock surged approximately 7% on Friday following the data storage manufacturer’s second-quarter fiscal 2026 earnings report. The company delivered results that crushed Wall Street expectations across the board.

Sandisk Corporation, SNDK

The memory maker posted earnings per share of $6.20, demolishing analyst estimates of $3.49. That’s a 77.65% surprise to the upside. Revenue reached $3.03 billion, well above the projected $2.67 billion.

The stock has now rallied 143% year-to-date. Over the past year, shares have skyrocketed 1,398%, trading at $539.30, just 1% below the 52-week high of $546.75.

Raymond James analyst Melissa Fairbanks upgraded SanDisk to Buy from Hold with a $725 price target. She called the upgrade “arguably one of the most delayed upgrades in history.” The five-star analyst expects continued upside despite the monster rally already in the books.

Data Center Demand Drives Supply Crunch

Fairbanks pointed to an “unprecedented” data center and AI cycle fueling exceptionally strong demand. Supply has tightened to levels where SanDisk could be sold out for the year. The company is prioritizing supply toward longer-lived data center builds and away from faster-turn edge and consumer markets.

Limited new supply is expected to come online in the near term. This should support continued strength in pricing. While Fairbanks previously favored DRAM suppliers, she now sees a more sustainable environment for NAND memory as well.

SanDisk’s Q3 fiscal 2026 guidance calls for top-line growth exceeding 52% sequentially. Moore noted that pricing must be up 60% or more quarter-over-quarter to achieve that revenue growth.

Conservative Guidance Suggests Upside

The analyst pointed out that margin growth of 15% quarter-over-quarter is much less than the 60% growth in average selling prices. This indicates the company’s $13 earnings per share guidance, which is 2.5 times consensus, appears conservative.

RBC Capital also jumped on board, raising its price target to $650 from $400. The firm maintained a Sector Perform rating. RBC analyst Srini Pajjuri noted management is “maximizing value through allocations” and developing longer-term agreements with customers.

RBC expects NAND supply constraints to persist throughout 2026. The firm cited disciplined capital expenditure and controlled supply growth in both NAND and hard disk drive markets as supporting factors.

The firm models approximately $92 in peak earnings for SanDisk. With the stock trading at roughly seven times that figure, RBC views the risk-reward profile as balanced. Memory stocks typically trade between five and ten times peak earnings per share.

Nine analysts have recently revised their earnings expectations upward. Revenue growth stands at 23.6%, with fiscal 2026 earnings per share forecast at $14.12.

Wall Street maintains a Strong Buy consensus rating on SanDisk based on 12 Buys and four Holds. The average price target of $597.19 suggests 4% upside potential from current levels.

Despite a slight decrease in bits, pricing increases of approximately 60% or more were observed sequentially in March.

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