Western Digital (NASDAQ:WDC) Shares Up 4.2% - Still a Buy?

Key Points

• Western Digital shares rose 4.2% on heavy trading, extending a sharp rally that pushed the stock to new highs during the session. The move reflects strong investor interest in the name.
• Analysts are turning more bullish as firms like Wells Fargo, Cantor Fitzgerald, and Bernstein raised price targets or upgraded ratings. The optimism centers on robust HDD demand, tight supply, and growing AI/hyperscaler storage demand.
• The company recently posted strong results and boosted its dividend, beating earnings and revenue estimates while guiding for higher future EPS. It also raised its quarterly dividend to $0.15 per share from $0.13.

Western Digital Corporation (NASDAQ:WDC - Get Free Report)'s share price shot up 4.2% on Tuesday . The company traded as high as $729.92 and last traded at $681.08. 15,729,916 shares traded hands during mid-day trading, an increase of 79% from the average session volume of 8,808,289 shares. The stock had previously closed at $653.53.

More Western Digital News

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

• Positive Sentiment: Analysts at Morgan Stanley and other firms raised targets and kept bullish ratings, pointing to strong HDD demand and tight supply. The Storage Squeeze: Why Western Digital Smashed Through 52-Week Highs in Blistering AI Rerating
• Positive Sentiment: Investors are re-rating Western Digital on signs of robust AI and hyperscaler storage demand, including multiyear customer commitments and sold-out inventory. Western Digital stock jumps as AI trade reignites
• Positive Sentiment: Western Digital’s upcoming June 22 SanDisk-related swap is being viewed as a possible near-term catalyst, adding event-driven interest to the rally. Dear Western Digital Stock Fans, Mark Your Calendars for June 22
• Neutral Sentiment: Some commentary warns the stock may be getting extended after its sharp run, suggesting a near-term pullback is possible even if the longer-term AI story remains intact. Western Digital stock looks ripe for a near-term pullback: find out more

Analysts Set New Price Targets

A number of brokerages recently weighed in on WDC. Wells Fargo & Company lifted their target price on Western Digital from $500.00 to $575.00 and gave the company an "overweight" rating in a report on Monday, June 1st. Cantor Fitzgerald lifted their target price on Western Digital to $660.00 and gave the company an "overweight" rating in a report on Friday, May 1st. Sanford C. Bernstein upgraded Western Digital from a "market perform" rating to an "outperform" rating and set a $340.00 target price on the stock in a report on Tuesday, March 31st. UBS Group lifted their target price on Western Digital from $350.00 to $375.00 and gave the company a "neutral" rating in a report on Friday, May 1st. Finally, Wall Street Zen upgraded Western Digital from a "hold" rating to a "buy" rating in a report on Saturday, May 2nd. One investment analyst has rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating and three have assigned a Hold rating to the company. According to MarketBeat.com, Western Digital has a consensus rating of "Moderate Buy" and a consensus price target of $450.46.

Western Digital Stock Up 4.2%

The stock has a 50 day simple moving average of $454.40 and a 200 day simple moving average of $312.52. The company has a market cap of $234.75 billion, a price-to-earnings ratio of 40.66 and a beta of 2.13.

Western Digital (NASDAQ:WDC - Get Free Report) last issued its quarterly earnings data on Thursday, April 30th. The data storage provider reported $2.72 EPS for the quarter, topping analysts' consensus estimates of $2.39 by $0.33. The company had revenue of $3.34 billion for the quarter, compared to analysts' expectations of $3.25 billion. Western Digital had a return on equity of 42.95% and a net margin of 55.29%.The firm's quarterly revenue was up 45.5% on a year-over-year basis. During the same quarter in the previous year, the firm posted $1.36 earnings per share. Western Digital has set its Q4 2026 guidance at 3.100-3.400 EPS. As a group, equities research analysts expect that Western Digital Corporation will post 9.6 EPS for the current fiscal year.

Western Digital Increases Dividend

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, June 17th. Stockholders of record on Friday, June 5th will be given a dividend of $0.15 per share. The ex-dividend date of this dividend is Friday, June 5th. This is a positive change from Western Digital's previous quarterly dividend of $0.13. This represents a $0.60 dividend on an annualized basis and a dividend yield of 0.1%. Western Digital's dividend payout ratio is presently 3.58%.

Insiders Place Their Bets

In other news, insider Cynthia L. Tregillis sold 432 shares of Western Digital stock in a transaction dated Friday, June 5th. The stock was sold at an average price of $545.60, for a total transaction of $235,699.20. Following the sale, the insider directly owned 116,643 shares of the company's stock, valued at approximately $63,640,420.80. The trade was a 0.37% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Vidyadhara K. Gubbi sold 2,475 shares of Western Digital stock in a transaction dated Monday, June 1st. The stock was sold at an average price of $556.24, for a total value of $1,376,694.00. Following the sale, the insider directly owned 85,154 shares in the company, valued at approximately $47,366,060.96. The trade was a 2.82% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold a total of 29,322 shares of company stock valued at $12,768,550 in the last three months. 0.18% of the stock is owned by insiders.

Institutional Trading of Western Digital

A number of hedge funds and other institutional investors have recently modified their holdings of WDC. Valley Wealth Managers Inc. bought a new stake in Western Digital in the first quarter valued at about $32,000. IMG Wealth Management Inc. increased its holdings in Western Digital by 853.8% in the first quarter. IMG Wealth Management Inc. now owns 124 shares of the data storage provider's stock valued at $34,000 after buying an additional 111 shares during the last quarter. Catalyst Capital Advisors LLC bought a new stake in Western Digital in the first quarter valued at about $35,000. Cornerstone Planning Group LLC increased its holdings in Western Digital by 33.3% in the first quarter. Cornerstone Planning Group LLC now owns 132 shares of the data storage provider's stock valued at $36,000 after buying an additional 33 shares during the last quarter. Finally, Annis Gardner Whiting Capital Advisors LLC increased its holdings in Western Digital by 80.2% in the first quarter. Annis Gardner Whiting Capital Advisors LLC now owns 146 shares of the data storage provider's stock valued at $39,000 after buying an additional 65 shares during the last quarter. 92.51% of the stock is owned by hedge funds and other institutional investors.

About Western Digital

Western Digital Corporation is a global data storage company that designs, manufactures and sells a broad range of storage devices and systems for personal, enterprise and cloud applications. Headquartered in San Jose, California, the company develops hard disk drives (HDDs), solid-state drives (SSDs), NAND flash components and finished storage products used in PCs, external storage, servers, network-attached storage (NAS) and embedded systems.

Its product portfolio spans consumer and commercial markets, including internal and external HDDs and SSDs, removable flash memory products and storage platforms for data center and enterprise environments.

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