Sandisk's stock has experienced significant fluctuations, dropping over 15% in late trading last week amid a broader sell-off in artificial intelligence stocks, influenced by Broadcom's earnings report and profit-taking after substantial gains. However, the stock has surged more than 550% in 2026.
Analyst Wamsi Mohan from Bank of America believes that Sandisk's pricing power will remain robust due to ongoing memory shortages driven by high demand from AI developments. He noted that the company has secured over a third of its projected fiscal 2027 revenue through new business model contracts, which stabilize earnings by locking in revenue and ensuring supply for customers.
Mohan reassured investors that even if demand for NAND memory slows, Sandisk's improved margin structure allows it to reduce production without financial strain, contrasting with past practices where continued production was necessary to maintain cash flow