Western Digital rallies as Wall Street sees more gains ahead
Analysts responded to yesterday’s Western Digital earnings by rapidly ramping up price targets.
Strong earnings from data storage device maker Western Digital on Thursday carried into Friday’s session, even as rival hard disk drive maker Seagate Technology Holdings lost the pop that followed its earnings report earlier in the week.
It may have something to do with the fact that Wall Street analysts see more potential upside for Western Digital. The company received a bevy of target price hikes since reporting results: 13 in total, according to StreetAccount, including from stock watchers at Goldman Sachs, JPMorgan, and Morgan Stanley.
The upshot is that the consensus price target on WDC shares leapt to nearly $164 in the last few hours, from about $131 yesterday. That’s a roughly 12% premium to where the stock was trading shortly after 2 p.m. ET.
Seagate also received a series of price target hikes from analysts after it released its numbers. But the Wall Street hive mind’s price prognostication for the stock — $267.50 per FactSet — was already surpassed at yesterday’s close. Perhaps that’s why there’s been a bit of profit taking on the stock Friday.
In case you’re wondering, we don’t usually obsess over makers of hard disk drives. But these affordable data storage devices are crucial to the development of cloud and AI data centers, and the current data center boom is creating unheard of levels of demand for them.
As a result, Western Digital and Seagate Technology are the second- and third-best-performing stocks in the S&P 500 this year. With gains of roughly 220% and 190%, respectively, they’re both on track for their best year since 2009.
