SanDisk (SNDK) stock tumbled 12.63% in recent trading, joining a brutal global semiconductor selloff that intensified following SK Hynix's historic decline. According to latest market data, the Philadelphia Semiconductor Index plunged 4.78% to 12,347.78 points, with all 30 of its constituents closing lower. SK Hynix's ADR fell 9.32% to close at $152.35, while Seagate Technology dropped 5.46%, Western Digital lost 4.64%, and Micron Technology declined 4.32%. The memory chip ETF (DRAM) crashed 9.11%, as investors continued to reduce exposure to companies tied to the AI boom. South Korean markets were particularly hard hit, with memory chip giant SK Hynix plunging as much as 13.35% intraday, while Samsung Electronics fell as much as 9.21%, with these two heavyweights accounting for nearly 30% of the KOSPI's total weighting. Barring Nvidia, which ended above the flat line on Wednesday, shares of AMD, Micron, Intel, Sandisk, Western Digital and the ADRs of South Korea's SK Hynix fell between 3.5% to 9% in mid-week trading.
Evercore ISI provided the most aggressive bullish outlook, raising its price target on SanDisk from an undisclosed prior level to $3,100 while maintaining an 'Outperform' rating. The firm expects fiscal 2027 revenue of $47.8 billion and earnings per share of $212.78, with more than 20% of earnings coming from secured New Business Model agreements. Evercore ISI values the stock at approximately 15 times its new fiscal 2027 earnings per share estimate, citing the durability of the company's earnings and free cash flow over the next few years. Susquehanna also increased its price target for SanDisk to $3,250, maintaining a Positive rating due to strong average selling prices and confidence in the company's margin profile. Bernstein analyst Mark Newman lifted his target to $3,000 from $1,700, pointing to structural changes in how memory suppliers now write long-term supply agreements.
SanDisk recently signed New Business Model agreements that provide committed revenues, with the company signing three deals in its fiscal third quarter totaling approximately $42 billion of remaining performance obligations, and two additional deals early in its fiscal fourth quarter with undisclosed balances. According to InvestingPro analysis, Evercore ISI estimates all five deals represent approximately $62 billion of minimum committed revenue over the next several years, with more than $11 billion of financial guarantees and prepayments. The firm projects over one-third of SanDisk's fiscal 2027 bits will be tied to these agreements at gross margins above 80%. These long-term commitments provide significant downside protection and visibility into future revenue streams, supporting the analysts' optimistic outlook despite current market volatility.
According to Wedbush analyst Matthew Bryson, as reported by MarketWatch, the memory market remains "in a very good place" with both Micron (MU) and SanDisk benefiting from AI-driven demand that chipmakers cannot quickly match, since new fabs take years to build. Data puts 18 of 22 analysts covering SanDisk at 'Buy' or 'Strong Buy,' with an average target of $2,112.32. The analyst consensus reflects continued confidence in SanDisk's ability to capitalize on AI-driven memory demand despite current market volatility. Bernstein's analysis highlighted historical long-term agreements, using Microchip as a case study where loose agreements provided little enforcement. Additionally, Bernstein noted a modest rise in DRAM and NAND contract prices, driven by strong server demand, with expectations of a significant price increase by the second quarter of 2026.
