Western Digital (WDC) stock climbed 5.9% on Friday, trading as high as $468.19 before settling at $467.46. The previous close was $441.57.
Western Digital Corporation, WDC
The move came as memory and storage stocks broadly rallied, with SK Hynix up 7% and Seagate gaining 5%. Investors are betting that AI infrastructure spending will continue to support pricing and earnings across the sector.
WDC has now gained around 70% over the past six months, though it remains well off its 52-week high of $799.87, reached in June.
Western Digital posted fiscal Q4 results on August 5th that beat on both the top and bottom lines. EPS came in at $3.56, topping the $3.31 consensus estimate. Revenue hit $3.75 billion versus the $3.70 billion expected, up 44% year over year.
Cloud revenue drove the quarter, accounting for roughly 89% of total sales at $3.3 billion, up 43% year over year. Demand for high-capacity nearline hard disk drives used in data centers was particularly strong.
Non-GAAP gross margin expanded to 54.4% and operating margin reached 44.2%. Return on equity came in at 48.15%.
For Q1 2027, management is guiding for revenue of approximately $4.1 billion and EPS of $3.85 to $4.15. Non-GAAP gross margin is expected between 55% and 56%.
Price per terabyte rose in the high teens year over year, backed by long-term customer agreements running through 2029 to 2031. At the same time, cost per terabyte fell around 8% in the quarter, with the company targeting a 10% annual reduction going forward.
WDC is ramping its next-generation ePMR drives with capacities up to 40TB and plans for UltraSMR technology to make up around 60% of nearline shipments by fiscal 2027.
The company returned $3.1 billion to shareholders in fiscal 2026, including $1 billion in buybacks and $54 million in dividends in Q4 alone. It ended the year with roughly $500 million in net cash.
Analysts sit at a “Moderate Buy” consensus. Price targets range widely, with Cantor Fitzgerald at $900, JPMorgan at $650, and Susquehanna at $500. The average target is $534.56.
On the cautious side, CEO Irving Tan sold 20,000 shares on August 11th for roughly $8.9 million. Total insider sales last quarter topped $10.4 million. Both transactions were executed under pre-arranged Rule 10b5-1 plans.
The 50-day moving average sits at $508.41 and the 200-day at $445.56. The stock trades at 7.52 times forward sales, above the industry average of 3.05.
Zacks revised its fiscal 2027 EPS estimate up 7.5% to $20.03 and its fiscal 2028 estimate up 7.6% to $34.74 over the past 60 days.
The post Western Digital (WDC) Stock Rises 6% on AI Storage Demand and Strong Q4 Earnings appeared first on CoinCentral.
