Western Digital (NASDAQ:WDC) Trading Down 5.3% - Here's What Happened

Key Points

• Western Digital shares fell 5.3% on Tuesday as investors took profits, with the stock moving lower alongside other memory-chip names like SanDisk and Micron. The decline came after a sharp year-to-date rally in the memory sector.
• Despite the pullback, the company has posted strong fundamentals, including an earnings beat, revenue above expectations, and raised Q4 2026 guidance. Analysts remain broadly constructive, with several firms lifting price targets and ratings.
• Western Digital also raised its quarterly dividend to $0.15 per share from $0.13, while insider selling and a cool-off in the “memory supercycle” trade added to near-term pressure on the stock.

Western Digital Corporation (NASDAQ:WDC - Get Free Report) shares traded down 5.3% during trading on Tuesday . The company traded as low as $466.80 and last traded at $488.74. 7,708,566 shares were traded during mid-day trading, a decline of 17% from the average session volume of 9,316,881 shares. The stock had previously closed at $515.83.

Key Western Digital News

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

• Positive Sentiment: Recent commentary remains bullish on WDC’s role in AI infrastructure, with analysts and market pieces pointing to strong demand for memory and storage chips from hyperscalers and data centers. Bull of the Day: Western Digital (WDC)
• Positive Sentiment: Western Digital’s latest quarterly results were strong, with earnings and revenue beating expectations and management raising its dividend, reinforcing the view that fundamentals are improving alongside AI-driven demand. Western Digital (WDC) Stock Soars to Record Peak on Stellar Q3 Results and Dividend Boost
• Neutral Sentiment: WDC has also been included in “undervalued stock” screens, suggesting some investors still see upside after the rally, but this is more valuation commentary than a direct catalyst. 3 Stocks That May Be Priced Below Their Estimated Value In May 2026
• Negative Sentiment: The main drag today is profit-taking in the broader memory complex, with Western Digital moving lower alongside SanDisk and Micron as traders rotate out after a sharp year-to-date surge. Western Digital falls as “memory supercycle” trade cools and investors lock in gains
• Negative Sentiment: Another report says the “memory supercycle” trade has hit pause, with WDC falling in sync with peers as investors reassess crowded AI-memory winners and lock in gains. SanDisk and Micron Fall 9%, Western Digital Drops 8% as Memory Supercycle Trade Hits Pause Button

Wall Street Analysts Forecast Growth

A number of research analysts recently commented on the company. Wells Fargo & Company increased their target price on Western Digital from $335.00 to $500.00 and gave the company an "overweight" rating in a research note on Friday, May 1st. Rosenblatt Securities increased their target price on Western Digital from $340.00 to $500.00 and gave the company a "buy" rating in a research note on Friday, May 1st. Wall Street Zen raised Western Digital from a "hold" rating to a "buy" rating in a research note on Saturday, May 2nd. Truist Financial set a $310.00 target price on Western Digital in a research note on Tuesday, February 3rd. Finally, Robert W. Baird raised their price objective on Western Digital from $310.00 to $450.00 and gave the company an "outperform" rating in a research note on Monday, May 4th. One research analyst has rated the stock with a Strong Buy rating, nineteen have issued a Buy rating and three have assigned a Hold rating to the company. Based on data from MarketBeat, the stock presently has an average rating of "Moderate Buy" and a consensus target price of $395.83.

Western Digital Price Performance

The firm's 50 day moving average is $334.30 and its 200 day moving average is $247.47. The company has a market capitalization of $168.46 billion, a PE ratio of 29.18 and a beta of 2.10.

Western Digital (NASDAQ:WDC - Get Free Report) last posted its quarterly earnings results on Thursday, April 30th. The data storage provider reported $2.72 EPS for the quarter, beating analysts' consensus estimates of $2.39 by $0.33. Western Digital had a net margin of 55.29% and a return on equity of 42.95%. The company had revenue of $3.34 billion during the quarter, compared to analyst estimates of $3.25 billion. During the same period in the prior year, the business posted $1.36 EPS. The firm's revenue was up 45.5% compared to the same quarter last year. Western Digital has set its Q4 2026 guidance at 3.100-3.400 EPS. As a group, analysts predict that Western Digital Corporation will post 9.57 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. Investors of record on Friday, June 5th will be paid a $0.15 dividend. The ex-dividend date of this dividend is Friday, June 5th. This is a boost from Western Digital's previous quarterly dividend of $0.13. This represents a $0.60 annualized dividend and a dividend yield of 0.1%. Western Digital's payout ratio is 2.99%.

Insider Buying and Selling

In other Western Digital news, CEO Irving Tan sold 20,000 shares of Western Digital stock in a transaction that occurred on Friday, May 1st. The stock was sold at an average price of $411.84, for a total transaction of $8,236,800.00. Following the sale, the chief executive officer directly owned 598,150 shares of the company's stock, valued at approximately $246,342,096. The trade was a 3.24% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Vidyadhara K. Gubbi sold 4,674 shares of Western Digital stock in a transaction that occurred on Monday, May 4th. The shares were sold at an average price of $443.19, for a total value of $2,071,470.06. Following the sale, the insider directly owned 90,041 shares in the company, valued at approximately $39,905,270.79. The trade was a 4.93% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold 53,679 shares of company stock valued at $18,049,314 over the last ninety days. 0.18% of the stock is owned by insiders.

Institutional Trading of Western Digital

Hedge funds have recently made changes to their positions in the stock. Vanguard Group Inc. raised its stake in Western Digital by 0.6% during the 3rd quarter. Vanguard Group Inc. now owns 43,282,393 shares of the data storage provider's stock valued at $5,196,484,000 after buying an additional 243,177 shares during the last quarter. WCM Investment Management LLC purchased a new stake in Western Digital during the 3rd quarter valued at $791,317,000. Norges Bank purchased a new stake in Western Digital during the 4th quarter valued at $788,729,000. Northern Trust Corp raised its stake in Western Digital by 11.2% during the 3rd quarter. Northern Trust Corp now owns 3,805,463 shares of the data storage provider's stock valued at $456,884,000 after buying an additional 384,103 shares during the last quarter. Finally, Dimensional Fund Advisors LP raised its stake in Western Digital by 11.8% during the 3rd quarter. Dimensional Fund Advisors LP now owns 3,804,907 shares of the data storage provider's stock valued at $456,737,000 after buying an additional 402,981 shares during the last quarter. 92.51% of the stock is owned by institutional investors.

Western Digital Company Profile

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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