SanDisk Surges 5% as Memory Sector Rallies on AI Demand, May 26

SanDisk shares climbed 5% to $1,619.63 on May 26 as the memory sector surged following UBS’s major upgrade of Micron Technology. The rally reflects explosive demand for AI-era storage infrastructure. SanDisk reported Q3 revenue of $5.95 billion, up 251% year over year, with earnings of $23.41 per share crushing consensus. The stock has risen 3,808% over the past year as data center spending accelerates.

UBS Lifts Micron, Pulls Entire Memory Complex Higher

UBS analyst Timothy Arcuri lifted Micron’s price target from $535 to $1,625, arguing that long-term memory supply agreements lock in pricing and demand visibility across the industry. This aggressive revision rippled across the sector, lifting SanDisk 7% and Western Digital 9% in midday trading. Arcuri expects Micron earnings to exceed $100 per share through at least 2029, reframing the company from cyclical commodity producer to durable AI infrastructure play. Micron itself is up 839% over the past year.

SanDisk Dominates NAND Flash Market as Data Centers Expand

SanDisk spun out of Western Digital in February 2025 and has become the pure-play NAND flash winner in the AI era. The company’s Q3 results, filed April 30, showed datacenter revenue of $1.47 billion, driving the 251% year-over-year revenue surge to $5.95 billion. Enterprise solid-state drives are replacing traditional hard-disk drives in AI data centers because SSDs fetch data faster, use less power, and occupy less physical space. Analysts have lifted price targets across the board, with Citigroup setting a $2,025 target and Melius Research targeting $2,350. The stock’s 50-day moving average sits at $999.79, while the 200-day is at $608.04.

Earnings Beat Signals Structural Shift in Memory Pricing

SanDisk’s Q3 earnings of $23.41 per share beat consensus by $9.24, while revenue of $5.95 billion exceeded the $4.7 billion consensus by 26%. The company reported a net profit margin of 34.19% and return on equity of 44.06%. For Q4 2026, management guided for earnings between $30.00 and $33.00 per share. Full-year analyst consensus now sits at $63.58 earnings per share, up from $41.60 just 60 days ago. This reflects a fundamental demand-supply mismatch giving memory suppliers pricing power they have never had before.

Meyka Rating Reflects Mixed Valuation Signals

Meyka rates SNDK a B+ with a 12-month price target of $835.73, suggesting limited upside from the current $1,619.63 price. The stock trades at a price-to-earnings ratio of 50.5, well above historical norms. The RSI sits at 63.96, indicating the stock is approaching overbought territory. However, 37 of 39 analysts rate the stock Buy or higher, with only 2 Hold ratings and no Sell ratings. With Meyka rating the stock B+ and analysts targeting $2,025-$2,350, the data points to significant downside risk despite strong earnings momentum.

Final Thoughts

SanDisk’s 5% rally reflects genuine AI infrastructure demand, but valuation concerns persist. Meyka’s B+ rating and $835.73 target suggest the stock has already priced in much of the upside, despite analyst targets above $2,000.

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