Western Digital (NASDAQ:WDC) Stock Price Up 6.9% – Still a Buy?

Western Digital Corporation (NASDAQ:WDC)’s share price shot up 6.9% on Tuesday. The company traded as high as $388.08 and last traded at $380.88. Approximately 8,939,203 shares traded hands during mid-day trading, an increase of 3% from the average daily volume of 8,694,238 shares. The stock had previously closed at $356.13.

Western Digital News Roundup

Here are the key news stories impacting Western Digital this week:

• Positive Sentiment: Western Digital’s latest earnings call highlighted strong hard-disk-drive demand, higher pricing, growing demand for higher-capacity drives and expanding AI-related storage needs. The company’s earnings and revenue exceeded estimates, supporting the case for continued operating momentum. WDC Q1 Earnings Call Highlights Pricing Strength and Storage Demand
• Positive Sentiment: Two Wall Street firms reportedly see nearly 130% potential upside after the recent selloff, arguing that the market may be underpricing Western Digital’s record results, raised guidance and storage-sector growth prospects. Western Digital Plummeted 20% in the Last 3 Months
• Positive Sentiment: Zacks added WDC to its Rank #1, or “Strong Buy,” list, while a separate analyst upgrade also supported the stock. New Strong Buy Stocks for October 28th
• Neutral Sentiment: Trefis reviewed why Western Digital’s stock has tripled over a longer period and which underlying business characteristics have not changed, underscoring both the company’s improved growth outlook and the importance of valuation and cyclicality. Western Digital Stock Tripled: What Changed And What Did Not?
• Negative Sentiment: A reported rumor involving Toshiba supply disrupted investor confidence and contributed to a steep decline over the prior three months, despite Western Digital’s strong results. The episode highlights the stock’s sensitivity to supply-chain developments. Western Digital Supply Rumor and Analyst Outlook
• Negative Sentiment: Argus issued a pessimistic forecast, and WDC also weakened after Seagate’s results pressured the broader storage-equipment group. Argus Issues Pessimistic Forecast for Western Digital

Analyst Upgrades and Downgrades

Several research analysts have recently issued reports on WDC shares. Rosenblatt Securities lowered their price objective on Western Digital from $800.00 to $650.00 and set a “buy” rating for the company in a research report on Friday, October 23rd. Zacks Research cut Western Digital from a “strong-buy” rating to a “hold” rating in a research note on Monday, October 5th. UBS Group reaffirmed a “buy” rating and issued a $625.00 price target on shares of Western Digital in a report on Friday, October 23rd. Sanford C. Bernstein raised their price objective on shares of Western Digital from $590.00 to $770.00 and gave the stock an “outperform” rating in a report on Thursday, August 6th. Finally, Citigroup dropped their target price on shares of Western Digital from $740.00 to $660.00 and set a “buy” rating on the stock in a research report on Friday, October 23rd. One research analyst has rated the stock with a Strong Buy rating, twenty-one have issued a Buy rating and six have issued a Hold rating to the company. According to data from MarketBeat.com, the stock currently has a consensus rating of “Moderate Buy” and an average target price of $591.04.

Western Digital Stock Down 0.8%

The stock has a fifty day moving average price of $424.85 and a two-hundred day moving average price of $415.00. The company has a market capitalization of $147.15 billion, a price-to-earnings ratio of 15.26, a PEG ratio of 1.45 and a beta of 2.11.

Western Digital (NASDAQ:WDC) last posted its quarterly earnings data on Thursday, October 22nd. The data storage provider reported $4.64 EPS for the quarter, beating analysts’ consensus estimates of $4.11 by $0.53. Western Digital had a return on equity of 55.62% and a net margin of 69.20%. The business had revenue of $4.38 billion for the quarter, compared to analyst estimates of $4.14 billion. During the same quarter last year, the company earned $1.78 earnings per share. The business’s revenue for the quarter was up 55.5% compared to the same quarter last year. As a group, research analysts forecast that Western Digital Corporation will post 20.23 earnings per share for the current fiscal year.

Western Digital Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, December 17th. Investors of record on Friday, December 4th will be paid a dividend of $0.1750 per share. The ex-dividend date of this dividend is Friday, December 4th. This is a positive change from Western Digital’s previous quarterly dividend of $0.15. This represents a $0.70 annualized dividend and a dividend yield of 0.2%. Western Digital’s payout ratio is currently 2.33%.

Insider Buying and Selling

In other Western Digital news, CEO Irving Tan sold 20,000 shares of the stock in a transaction on Tuesday, August 11th. The stock was sold at an average price of $444.97, for a total transaction of $8,899,400.00. Following the transaction, the chief executive officer owned 575,966 shares of the company’s stock, valued at $256,287,591.02. This represents a 3.36% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Cynthia L. Tregillis sold 807 shares of the firm’s stock in a transaction on Wednesday, October 21st. The stock was sold at an average price of $380.00, for a total value of $306,660.00. Following the sale, the insider owned 108,928 shares in the company, valued at $41,392,640. This trade represents a 0.74% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last 90 days, insiders have sold 25,436 shares of company stock worth $11,340,064. 0.20% of the stock is owned by insiders.

Hedge Funds Weigh In On Western Digital

Large investors have recently added to or reduced their stakes in the business. Mowery & Schoenfeld Wealth Management LLC acquired a new position in shares of Western Digital in the second quarter worth about $28,000. Dunhill Financial LLC purchased a new position in Western Digital in the second quarter valued at about $29,000. Stonehage Fleming Financial Services Holdings Ltd acquired a new stake in Western Digital during the 2nd quarter valued at approximately $31,000. Gables Capital Management Inc. acquired a new stake in Western Digital during the 2nd quarter valued at approximately $32,000. Finally, Valley National Advisers Inc. grew its stake in Western Digital by 182.6% during the 3rd quarter. Valley National Advisers Inc. now owns 65 shares of the data storage provider’s stock valued at $30,000 after purchasing an additional 42 shares in the last quarter. 92.51% of the stock is currently owned by hedge funds and other institutional investors.

Western Digital Company Profile

Western Digital Corporation (NASDAQ: WDC) is a data storage technology company that develops and manufactures hard disk drives (HDDs) and related storage solutions. Its products are used in data centers, cloud infrastructure, enterprise systems, personal computers, gaming platforms and external storage devices.

The company offers HDD-based products for business and consumer applications, including high-capacity drives designed for hyperscale and cloud data centers, enterprise storage environments, network-attached storage systems and personal computing.