Shares of Sandisk Corporation reached an unprecedented high on Monday, climbing 7.4% to close at $1,063.55, as analysts increasingly bet on the company's pivotal role in artificial intelligence-driven data storage. Trading volume surged to nearly 9.6 million shares, reflecting heightened investor interest ahead of the company's fiscal third-quarter earnings report scheduled for April 30.
Analyst Optimism Fuels Rally
The rally was sparked by Melius Research, which initiated coverage on Sandisk with a Buy rating and a two-year price target of $1,350. Analyst Ben Reitzes highlighted what he termed an 'AI memory cycle' that could sustain demand through the end of the decade, with robust appetite for high-bandwidth memory, DRAM, and NAND flash storage. This bullish call joins a wave of positive sentiment from other Wall Street firms. Cantor Fitzgerald raised its price target to $1,400 from $1,000, maintaining an Overweight rating, while Morgan Stanley lifted its target to $1,100.
Earnings Expectations High
Sandisk is set to report its fiscal third-quarter results on Thursday, April 30, at 1:30 p.m. Pacific time. The company previously guided for revenue between $4.40 billion and $4.80 billion, with non-GAAP diluted earnings per share in the range of $12 to $14. In the second quarter, Sandisk posted a 31% sequential revenue increase to $3.03 billion, driven by a 64% surge in data-center revenue fueled by AI infrastructure investments from major tech customers.
Market Context and Index Inclusion
The stock's ascent was further supported by its addition to the Nasdaq-100 Index on April 20, replacing Atlassian. The index, which tracks 100 of the largest non-financial companies on the Nasdaq, serves as the benchmark for over 200 investment products managing more than $600 billion in assets. The inclusion likely triggered passive buying from index funds.
Options Market Signals Volatility
Options traders are bracing for significant price swings following the earnings release. The market is pricing in an implied move of 16.57% for Sandisk shares, the highest among mega-cap companies reporting this week, according to Benzinga. This suggests expectations for a substantial reaction, either positive or negative, to the quarterly results.
Industry Ripple Effects
Sandisk's gains lifted other memory-related stocks. Micron Technology jumped 4.9% on Monday, while Western Digital, which spun off Sandisk as a separate public company in February 2025, edged down 0.4%. Western Digital continues to be viewed as a bellwether for the storage cycle.
Risks Remain
Despite the optimism, risks persist. The memory industry is notoriously cyclical, and any signs of oversupply or a pullback in AI-related capital expenditures could pressure pricing and earnings. In its January update, Sandisk highlighted the importance of product mix, enterprise SSD rollouts, and the fast-changing demand environment typical of memory markets.
