Western Digital (NASDAQ:WDC) Trading Down 6.9% - Here's Why

Key Points

• Western Digital shares fell 6.9% on Friday, trading as low as $509.56 before closing at $519.80, well below the prior close of $558.30.
• Despite the stock drop, analysts remain broadly positive: several firms recently raised price targets, and Western Digital now has a Moderate Buy consensus with an average target price of $520.32.
• The company posted strong quarterly results, beating EPS and revenue estimates, and also raised its quarterly dividend from $0.12 to $0.15 per share.

Western Digital Corporation (NASDAQ:WDC - Get Free Report)'s stock price traded down 6.9% during trading on Friday . The stock traded as low as $509.56 and last traded at $519.80. 4,722,849 shares were traded during trading, a decline of 47% from the average session volume of 8,930,697 shares. The stock had previously closed at $558.30.

Wall Street Analyst Weigh In

WDC has been the topic of a number of research reports. Evercore reissued an "outperform" rating and issued a $575.00 price objective on shares of Western Digital in a research note on Tuesday, May 26th. JPMorgan Chase & Co. lifted their target price on Western Digital from $530.00 to $650.00 and gave the stock an "overweight" rating in a report on Friday, June 12th. TD Cowen boosted their price target on shares of Western Digital from $325.00 to $500.00 and gave the stock a "buy" rating in a research report on Friday, May 1st. Morgan Stanley upped their price target on shares of Western Digital from $488.00 to $650.00 and gave the company an "overweight" rating in a report on Monday, June 15th. Finally, Mizuho raised their price objective on shares of Western Digital from $550.00 to $685.00 and gave the company an "outperform" rating in a research report on Monday, June 8th. Two research analysts have rated the stock with a Strong Buy rating, eighteen have given a Buy rating and four have given a Hold rating to the company's stock. According to MarketBeat, Western Digital presently has a consensus rating of "Moderate Buy" and an average target price of $520.32.

Western Digital Price Performance

The firm's fifty day simple moving average is $564.15 and its 200 day simple moving average is $396.20. The company has a market capitalization of $179.16 billion, a price-to-earnings ratio of 31.03 and a beta of 2.11.

Western Digital (NASDAQ:WDC - Get Free Report) last released its quarterly earnings results on Thursday, April 30th. The data storage provider reported $2.72 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $2.39 by $0.33. The business had revenue of $3.34 billion for the quarter, compared to analyst estimates of $3.25 billion. Western Digital had a net margin of 55.29% and a return on equity of 42.95%. The firm's revenue was up 45.5% compared to the same quarter last year. During the same quarter in the previous year, the business earned $1.36 earnings per share. Western Digital has set its Q4 2026 guidance at 3.100-3.400 EPS. Equities research analysts forecast that Western Digital Corporation will post 9.61 earnings per share for the current fiscal year.

Western Digital Increases Dividend

The company also recently announced a quarterly dividend, which was paid on Wednesday, June 17th. Shareholders of record on Friday, June 5th were paid a dividend of $0.15 per share. This is an increase from Western Digital's previous quarterly dividend of $0.12. The ex-dividend date of this dividend was Friday, June 5th. This represents a $0.60 annualized dividend and a yield of 0.1%. Western Digital's dividend payout ratio (DPR) is presently 3.58%.

Insiders Place Their Bets

In other news, Director Bruce E. Kiddoo sold 750 shares of Western Digital stock in a transaction on Thursday, May 28th. The stock was sold at an average price of $528.52, for a total transaction of $396,390.00. Following the transaction, the director owned 3,903 shares in the company, valued at approximately $2,062,813.56. The trade was a 16.12% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, CEO Irving Tan sold 20,000 shares of the company's stock in a transaction on Friday, May 1st. The shares were sold at an average price of $411.84, for a total value of $8,236,800.00. Following the transaction, the chief executive officer directly owned 598,150 shares in the company, valued at $246,342,096. The trade was a 3.24% 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 have sold 28,959 shares of company stock worth $12,631,666 over the last three months. Company insiders own 0.18% of the company's stock.

Hedge Funds Weigh In On Western Digital

Several institutional investors and hedge funds have recently bought and sold shares of the business. Tema ETFs LLC boosted its holdings in shares of Western Digital by 10.6% during the second quarter. Tema ETFs LLC now owns 6,805 shares of the data storage provider's stock worth $4,346,000 after purchasing an additional 652 shares during the period. Nolet Wealth Management LLC acquired a new position in Western Digital in the 2nd quarter valued at approximately $264,000. E. Ohman J or Asset Management AB lifted its position in Western Digital by 5.4% in the 2nd quarter. E. Ohman J or Asset Management AB now owns 12,394 shares of the data storage provider's stock worth $7,916,000 after buying an additional 640 shares in the last quarter. Handelsbanken Fonder AB lifted its position in Western Digital by 71.4% in the 2nd quarter. Handelsbanken Fonder AB now owns 230,578 shares of the data storage provider's stock worth $147,275,000 after buying an additional 96,078 shares in the last quarter. Finally, KMG Fiduciary Partners LLC acquired a new stake in shares of Western Digital during the 2nd quarter valued at $213,000. Hedge funds and other institutional investors own 92.51% of the company's stock.

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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