A $2,400 price target implies Sandisk still has 36% upside after already rallying hard this year. The bet is that NAND flash stops being a commodity.
Rosenblatt initiated coverage of Sandisk this week with a buy rating and a $2,400 price target, implying roughly 36% upside from Monday's closing price and helping send shares up as much as 7% in trading. The call rests on a specific thesis: that new AI computing platforms are turning NAND flash memory from an interchangeable, commodity storage component into critical infrastructure for AI systems.
"New AI compute platforms are creating an opportunity to reposition NAND Flash from a commodity storage medium to a more system-critical component of AI infrastructure," Rosenblatt analyst Kevin Cassidy wrote in a note to clients.
The call follows a quarter in which Sandisk reported revenue of $3 billion, up 61% year over year and ahead of estimates, while adjusted earnings jumped 404% to $6.20 a share, also topping Wall Street expectations. The company's forward guidance came in well above what analysts had modeled, reinforcing the view that demand tied to AI data-center buildouts is showing up directly in memory-chip results rather than staying a future promise.
Rosenblatt's repositioning argument is a bet that AI infrastructure spending changes the economics of an industry that has historically traded on commodity-like pricing cycles. If it's right, Sandisk stops being valued like a cyclical hardware supplier and starts being valued more like the specialized AI infrastructure names, chipmakers, networking equipment and data-center hardware companies, that have carried much of this year's market gains. If it's wrong, and NAND pricing reverts to its usual boom-bust pattern once AI-driven demand growth slows, the stock's re-rating this year has further to fall than to climb from here.