Western Digital Corporation (NASDAQ:WDC) Short Interest Update

Key Points

• Short interest in Western Digital Corporation skyrocketed by 370.2% in July, reaching a total of 33 million shares, indicating increased bearish sentiment among investors.
• The company reported strong quarterly earnings with $1.66 earnings per share, surpassing estimates, along with a 30% year-over-year revenue increase to $2.61 billion.
• Western Digital's Board of Directors approved a $2 billion share buyback plan, reflecting confidence in the company's current stock value.

Western Digital Corporation (NASDAQ:WDC - Get Free Report) was the target of a significant increase in short interest in July. As of July 15th, there was short interest totaling 33,010,000 shares, anincreaseof370.2% from the June 30th total of 7,020,000 shares. Based on an average daily trading volume, of 6,440,000 shares, the days-to-cover ratio is presently 5.1 days. Based on an average daily trading volume, of 6,440,000 shares, the days-to-cover ratio is presently 5.1 days.

Insider Transactions at Western Digital

In related news, CEO Irving Tan sold 11,379 shares of the stock in a transaction dated Tuesday, May 13th. The stock was sold at an average price of $48.19, for a total transaction of $548,354.01. Following the transaction, the chief executive officer directly owned 605,481 shares in the company, valued at approximately $29,178,129.39. This represents a 1.84% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through this hyperlink. Also, SVP Gene M. Zamiska sold 1,729 shares of Western Digital stock in a transaction dated Thursday, June 5th. The shares were sold at an average price of $54.88, for a total value of $94,887.52. Following the completion of the sale, the senior vice president owned 40,089 shares of the company's stock, valued at $2,200,084.32. This trade represents a 4.13% decrease in their position. The disclosure for this sale can be found here. Over the last quarter, insiders have sold 13,353 shares of company stock valued at $657,454. Insiders own 0.30% of the company's stock.

Institutional Trading of Western Digital

Several hedge funds and other institutional investors have recently bought and sold shares of WDC. Wealth Enhancement Advisory Services LLC raised its stake in Western Digital by 52.9% in the first quarter. Wealth Enhancement Advisory Services LLC now owns 28,838 shares of the data storage provider's stock valued at $1,166,000 after purchasing an additional 9,974 shares in the last quarter. Asset Management One Co. Ltd. lifted its holdings in shares of Western Digital by 5.1% during the 1st quarter. Asset Management One Co. Ltd. now owns 144,307 shares of the data storage provider's stock worth $5,834,000 after acquiring an additional 6,947 shares during the period. Sumitomo Mitsui DS Asset Management Company Ltd increased its stake in Western Digital by 6.8% in the first quarter. Sumitomo Mitsui DS Asset Management Company Ltd now owns 89,244 shares of the data storage provider's stock valued at $3,608,000 after acquiring an additional 5,711 shares during the last quarter. Polymer Capital Management US LLC acquired a new position in Western Digital during the fourth quarter valued at approximately $5,711,000. Finally, Westfield Capital Management Co. LP bought a new stake in Western Digital during the first quarter worth $35,406,000. Institutional investors and hedge funds own 92.51% of the company's stock.

Wall Street Analysts Forecast Growth

Several brokerages have commented on WDC. TD Securities dropped their price target on Western Digital from $80.00 to $53.00 and set a "buy" rating for the company in a research note on Thursday, May 1st. Bank of America raised their price objective on Western Digital from $62.00 to $71.00 and gave the company a "buy" rating in a research note on Monday, June 9th. Citigroup upped their price target on shares of Western Digital from $78.00 to $88.00 and gave the company a "buy" rating in a report on Thursday, July 31st. JPMorgan Chase & Co. raised shares of Western Digital from a "neutral" rating to an "overweight" rating and raised their target price for the stock from $45.00 to $57.00 in a report on Thursday, May 1st. Finally, UBS Group boosted their price objective on Western Digital from $45.00 to $75.00 and gave the company a "neutral" rating in a research report on Monday, July 21st. Four analysts have rated the stock with a hold rating and eighteen have assigned a buy rating to the company. According to data from MarketBeat, Western Digital has an average rating of "Moderate Buy" and a consensus price target of $78.74.

Western Digital Trading Down 2.7%

Shares of NASDAQ WDC traded down $2.03 during midday trading on Wednesday, reaching $73.81. 2,374,261 shares of the stock were exchanged, compared to its average volume of 8,009,693. The company has a market capitalization of $25.75 billion, a price-to-earnings ratio of 14.34, a P/E/G ratio of 0.93 and a beta of 1.58. The company has a debt-to-equity ratio of 0.47, a current ratio of 1.08 and a quick ratio of 0.84. The business has a 50-day simple moving average of $63.24 and a two-hundred day simple moving average of $54.00. Western Digital has a 12 month low of $28.83 and a 12 month high of $78.80.

Western Digital (NASDAQ:WDC - Get Free Report) last posted its quarterly earnings data on Wednesday, July 30th. The data storage provider reported $1.66 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.48 by $0.18. Western Digital had a net margin of 14.13% and a return on equity of 24.93%. The company had revenue of $2.61 billion for the quarter, compared to the consensus estimate of $2.45 billion. During the same period last year, the company earned $1.44 earnings per share. The firm's revenue was up 30.0% compared to the same quarter last year. As a group, equities research analysts expect that Western Digital will post 4.89 EPS for the current year.

Western Digital declared that its board has authorized a stock repurchase program on Tuesday, May 13th that permits the company to buyback $2.00 billion in outstanding shares. This buyback authorization permits the data storage provider to reacquire up to 11.7% of its stock through open market purchases. Stock buyback programs are often a sign that the company's board of directors believes its shares are undervalued.

Western Digital Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Thursday, September 18th. Stockholders of record on Thursday, September 4th will be paid a dividend of $0.10 per share. This represents a $0.40 dividend on an annualized basis and a dividend yield of 0.5%. The ex-dividend date is Thursday, September 4th. Western Digital's dividend payout ratio (DPR) is currently 7.77%.

About Western Digital

Western Digital Corporation develops, manufactures, and sells data storage devices and solutions in the United States, China, Hong Kong, Europe, the Middle East, Africa, rest of Asia, and internationally. It offers client devices, including hard disk drives (HDDs) and solid state drives (SSDs) for desktop and notebook personal computers (PCs), gaming consoles, and set top boxes; and flash-based embedded storage products for mobile phones, tablets, notebook PCs, and other portable and wearable devices, as well as automotive, Internet of Things, industrial, and connected home applications.