Sandisk's (SNDK +2.68%) stock price has had a sensational run over the last 12 months, climbing over 3,100%. For anyone who invested recently, however, the period from July 13 to July 17 was jarring.
Several issues pushed the Sandisk stock price lower. Broadly, geopolitical uncertainty seemingly drove a rotation out of tech stocks. But specifically on July 17, a new artificial intelligence (AI) model out of China rattled U.S. chip stocks hard. From July 13 to July 17, Sandisk shares dropped 24.5%.
That said, it's not time to press the panic button. Sandisk is turning unprecedented demand for its memory and storage solutions into massive revenue growth, it's locking in long-term deals, and a $2,500-per-share price target projection suggests the stock still has plenty of room to run higher from today's prices.
Image source: The Motley Fool.
Sales keep flooding in
AI models demanding more memory and storage solutions to run efficiently have been a boon for Sandisk. In its fiscal third-quarter earnings for 2026, it reported revenue climbed 251% to $5.9 billion. That's quite an impressive feat, considering its 2025 full-year revenue was $7.3 billion.
It also flexed its pricing power in the third quarter, with generally accepted accounting principles gross (GAAP) margin improving from 22.5% to 78.4%. It also reported GAAP net income of $3.6 billion, another noteworthy boost from the $1.9 billion net loss it reported in Q3 2025.
Sandisk's fourth-quarter 2026 earnings are also expected to be strong; revenue is expected to fall in a range of $7.75 billion to $8.25 billion.
In addition, it's important to remember that Sandisk is a cyclical company; it's setting up long-term contracts. In its third quarter, it signed three deals with a minimum contractual revenue of $42 billion. It also has five other deals that the management team should share more details on in the fourth quarter.
NASDAQ: SNDK
Key Data Points
What price targets suggest
Of the 29 analysts tracked by CNN, the median price target for Sandisk over the next 12 months is $2,500. The highest price target tracked from those analysts is $3,250, while the lowest is $1,000.
We'll focus on the median to avoid outliers. From the closing price of $1,354.82 on July 17, if Sandisk were to reach that $2,500 price target over the next year, it would be a gain of 84.5%.
Looking at it another way, if Sandisk reaches $2,500, here's what a $5,000, $10,000, and $15,000 investment would roughly look like if an investor bought shares at the July 17 closing price of $1,354.82.
|
Investment |
Investment Value at a $2,500 Stock Price |
|---|---|
|
$5,000 |
$9,225 |
|
$10,000 |
$18,450 |
|
$15,000 |
$27,675 |
Calculations by author
That median $2,500 price target, however, shouldn't be the sole consideration for whether to buy shares. It also shouldn't be taken as a guarantee. Rather, it helps gauge the risk-to-reward setup of owning Sandisk.
While there may be more price swings ahead, there's nothing that indicates that Sandisk should be abandoned as a long-term investment consideration. As supply seems unlikely to meet demand any time soon, with Sandisk continuing to hold pricing power, it should remain a beneficiary of AI's insatiable need for memory and storage solutions.
