Western Digital (NASDAQ:WDC) Stock Price Down 6.9% - Here's What Happened

Key Points

• Western Digital shares fell 6.9% to $332 amid concerns that Toshiba’s planned HDD capacity expansion and potential Chinese competition could increase supply, pressure pricing, and challenge elevated AI-storage valuations.
• Despite the selloff, Wells Fargo called the decline “well overdone,” citing strong data-center demand. Western Digital is scheduled to report fiscal first-quarter results on October 22, with analysts expecting roughly 45% revenue growth and company guidance of $3.85–$4.15 in EPS.
• Analysts maintain a broadly positive view, with a “Moderate Buy” consensus rating and an average price target of $608.26, although several firms recently lowered their targets. The company’s latest quarter exceeded earnings and revenue estimates, with revenue up 43.8% year over year.

Western Digital Corporation (NASDAQ:WDC - Get Free Report)'s stock price traded down 6.9% during trading on Friday. The company traded as low as $331.81 and last traded at $332.00. 7,937,417 shares were traded during mid-day trading, a decline of 8% from the average daily volume of 8,649,698 shares. The stock had previously closed at $356.45.

Key Western Digital News

Here are the key news stories impacting Western Digital this week:

• Positive Sentiment: Wells Fargo said the recent selloff in Western Digital and Seagate shares was “well overdone” and maintained a bullish view, even after lowering its price target. The firm cited strong underlying demand for data-center storage. Seagate and Western Digital Stocks Fall on Toshiba Fears. Wells Fargo Is Still Bullish.
• Positive Sentiment: Western Digital is expected to report fiscal first-quarter results on October 22. Analysts are watching for revenue growth of roughly 45%, supported by accelerating AI and cloud-storage demand, with the company’s existing guidance calling for $3.85–$4.15 in EPS. Western Digital Pre-Q1 Earnings: Buy the Stock Now or Wait for Results?
• Neutral Sentiment: A discounted 2TB WD portable external drive could support consumer demand, but the promotion is unlikely to materially affect Western Digital’s financial results. WD Goes All-In on Its 2TB Portable External Hard Drive
• Negative Sentiment: Investors are concerned that Toshiba’s planned hard-disk-drive capacity expansion could increase future supply and pressure pricing just as Western Digital and Seagate are benefiting from strong AI-related demand. Higher interest-rate risks and questions about the sustainability of hyperscaler capital spending are adding pressure. Seagate, Western Digital Face Supply Risks as AI Demand Drives Capacity Expansion
• Negative Sentiment: Western Digital and other memory stocks are being pressured by reports that a Chinese competitor is developing server-memory products, raising fears of new competition in an AI infrastructure market that had supported elevated valuations. Analysts have also questioned whether Western Digital is approaching a cyclical peak and suggested Seagate may offer the stronger trade. Memory Stocks Extend Selloff on China Competition Fears

Analyst Upgrades and Downgrades

A number of research firms recently commented on WDC. TD Cowen boosted their price objective on shares of Western Digital from $500.00 to $540.00 and gave the stock a "buy" rating in a report on Thursday, August 6th. Rosenblatt Securities cut their price objective on shares of Western Digital from $900.00 to $800.00 and set a "buy" rating for the company in a research report on Thursday, August 6th. Citigroup cut their price objective on shares of Western Digital from $800.00 to $740.00 and set a "buy" rating on the stock in a report on Friday, August 7th. Mizuho set a $590.00 target price on shares of Western Digital in a research note on Thursday, August 6th. Finally, Melius Research set a $1,050.00 price objective on Western Digital and gave the stock a "buy" rating in a report on Monday, June 29th. One investment analyst has rated the stock with a Strong Buy rating, twenty have issued a Buy rating and seven have issued a Hold rating to the company. According to MarketBeat, Western Digital has an average rating of "Moderate Buy" and a consensus target price of $608.26.

Western Digital Trading Down 6.9%

The company has a market cap of $124.27 billion, a price-to-earnings ratio of 13.71, a P/E/G ratio of 1.54 and a beta of 2.11. The business has a 50-day moving average price of $444.89 and a 200 day moving average price of $477.85.

Western Digital (NASDAQ:WDC - Get Free Report) last issued its quarterly earnings results on Wednesday, August 5th. The data storage provider reported $3.56 earnings per share for the quarter, beating analysts' consensus estimates of $3.31 by $0.25. The business had revenue of $3.75 billion for the quarter, compared to the consensus estimate of $3.70 billion. Western Digital had a return on equity of 48.15% and a net margin of 72.95%. Western Digital's revenue for the quarter was up 43.8% compared to the same quarter last year. During the same quarter in the previous year, the company posted $1.66 earnings per share. Western Digital has set its Q1 2027 guidance at 3.850-4.150 EPS. On average, analysts anticipate that Western Digital Corporation will post 19.65 earnings per share for the current year.

Western Digital Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Thursday, September 17th. Stockholders of record on Tuesday, September 8th were given a $0.15 dividend. This represents a $0.60 dividend on an annualized basis and a dividend yield of 0.2%. The ex-dividend date of this dividend was Tuesday, September 8th. Western Digital's payout ratio is currently 2.48%.

Insider Activity

In related news, CEO Irving Tan sold 20,000 shares of the company's stock in a transaction that occurred on Tuesday, August 11th. The stock was sold at an average price of $444.97, for a total value of $8,899,400.00. Following the sale, the chief executive officer directly owned 575,966 shares in the company, valued at $256,287,591.02. This represents a 3.36% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Cynthia L. Tregillis sold 1,007 shares of the company's stock in a transaction that occurred on Thursday, August 27th. The stock was sold at an average price of $478.36, for a total value of $481,708.52. Following the transaction, the insider directly owned 112,155 shares in the company, valued at $53,650,465.80. The trade was a 0.89% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 25,437 shares of company stock valued at $11,461,345 in the last quarter. Company insiders own 0.20% of the company's stock.

Hedge Funds Weigh In On Western Digital

Several hedge funds and other institutional investors have recently added to or reduced their stakes in WDC. Dogwood Wealth Management LLC increased its stake in shares of Western Digital by 28.6% in the second quarter. Dogwood Wealth Management LLC now owns 90 shares of the data storage provider's stock worth $57,000 after buying an additional 20 shares during the last quarter. Legacy Wealth Asset Management LLC grew its stake in Western Digital by 1.0% in the second quarter. Legacy Wealth Asset Management LLC now owns 2,302 shares of the data storage provider's stock worth $1,470,000 after purchasing an additional 22 shares in the last quarter. Everpar Advisors LLC grew its stake in Western Digital by 1.8% in the second quarter. Everpar Advisors LLC now owns 1,442 shares of the data storage provider's stock worth $921,000 after purchasing an additional 25 shares in the last quarter. Ares Financial Consulting LLC increased its holdings in Western Digital by 45.5% in the second quarter. Ares Financial Consulting LLC now owns 80 shares of the data storage provider's stock valued at $51,000 after buying an additional 25 shares during the last quarter. Finally, Dynamic Advisor Solutions LLC increased its holdings in Western Digital by 2.1% in the second quarter. Dynamic Advisor Solutions LLC now owns 1,390 shares of the data storage provider's stock valued at $888,000 after buying an additional 28 shares during the last quarter. 92.51% of the stock is currently owned by hedge funds and other institutional investors.

Western Digital Company Profile

Western Digital Corporation NASDAQ: WDC develops, manufactures and supplies data-storage products and solutions. The company's portfolio is centered on hard disk drives (HDDs) used in cloud and enterprise data centers, personal computers, network-attached storage systems and other applications that require high-capacity data storage.

Western Digital markets products under brands including Western Digital, WD and Ultrastar. Its offerings include enterprise and data-center HDDs, storage products for business and consumer systems, and related technologies designed to help organizations store, manage and access large volumes of data.

Founded in 1970, Western Digital has evolved from a maker of electronic components into a global data-storage company.

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