- Sandisk stock price has soared by 4,755% in the last 12 months.
- Top Wall Street analysts predict that the stock has more upside.
- Technicals suggest that, while the rally has more room to go, there is a risk of a reversal.
Sandisk stock is firing on all cylinders this year, continuing a surge that started shortly after its spin-off from Western Digital last year. SNDK has soared by 800% this year and by 4,755% over the last 12 months, with its valuation now at $325 billion. Despite this surge, analysts are optimistic that the company has more upside this year.
Analysts are Optimistic About the Sandisk Stock Price
Wall Street analysts are optimistic that the Sandisk share price has more room to grow as the AI supercycle continues. The most optimistic analysts are from Susquehanna, who believe that the shares will jump to $3,250. Such a move will drive its market capitalization to over $481 billion.
Cantor Fitzgerald analysts believe the stock will jump to $2,900, while Melius Research expects it to reach $2,350. The other highly bullish analysts are from firms such as Mizuho, Bank of America, and Barclays.
These analysts cite several reasons for the bullish outlook. For example, in a recent note, a Bank of America analyst argued that the ongoing transition to longer-term contracts will help the bank avoid going through different cycles.
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Analysts are also highly optimistic that its revenue growth will continue in the near term. Its annual revenue is expected to soar by 166% to $20 billion this year, then to $43 billion next year. If this trend continues, it will hit the $100 billion milestone in the coming years.
Sandisk’s revenue growth has coincided with its margin expansion. Data show that its net income margin has jumped to 34%, above the sector median of 6%. This growth will likely exceed 40% over time.
Still, SanDisk stock faces a major risk as the AI supercycle begins to slow in the coming years. If this happens, we could see memory device prices start to fall, which will affect their growth.
SNDK Stock Price Technical Analysis
The daily chart shows that the Sandisk stock price has been in a strong rally this year and is now trading at a record high of $2,185. As a result, it has remained above all moving averages, with the 100-day EMA moving to $1,130.
These technicals suggest that the stock has more upside in the coming months. However, the moving average means it is at risk of a mean reversal, a situation where an asset moves downward to align with its moving average.
The Relative Strength Index (RSI) has formed a symmetrical triangle pattern, with the two lines nearing their confluence. Therefore, there is a risk that the stock’s bull run may be about to end. The most likely scenario is that the rally continues to rise in the near term and then retreats over time.
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