Sandisk slides on Citron short announcement
Sandisk’s roughly 1,200% run-up over the last year — it was spun off from Western Digital exactly a year ago — took a breather early Tuesday, after well-known stuff-stirrer Citron Research, short seller Andrew Left’s firm, announced it was short the stock.
In a post on X, Citron suggested that while Sandisk has benefited from the parabolic price increase for memory chips, it’s only a matter of time before giant contract chip manufacturers like Samsung Electronics and TSMC turn on the taps:
“The market is pricing SanDisk like it’s $NVDA. There’s one problem: NVIDIA has a moat. SanDisk sells a commodity. We’ve seen this movie before 2008, 2012, 2018. It’s never different this time. Memory is a cycle, and cycles peak.”
That’s true historically speaking, but Wall Street seems to see the memory price spike continuing for at least a couple more years. Analysts have ratcheted up their earnings expectations over the next few years, in line with the guidance Sandisk issued in its latest earnings report. And shorting a stock with this much momentum — it’s up more than 150% this year alone! — is treacherous indeed.
“The market is pricing SanDisk like it’s $NVDA. There’s one problem: NVIDIA has a moat. SanDisk sells a commodity. We’ve seen this movie before 2008, 2012, 2018. It’s never different this time. Memory is a cycle, and cycles peak.”
That’s true historically speaking, but Wall Street seems to see the memory price spike continuing for at least a couple more years. Analysts have ratcheted up their earnings expectations over the next few years, in line with the guidance Sandisk issued in its latest earnings report. And shorting a stock with this much momentum — it’s up more than 150% this year alone! — is treacherous indeed.
