SanDisk shares have surged nearly 4,842% over the past year, but 24/7 Wall St. issued a sell rating with a $1,704.60 price target, implying 27% downside. The call comes as the stock's monthly RSI hits 99 and gross margins have expanded to 78.4%, raising concerns the rally has overshot fundamentals.
24/7 Wall St. issued a sell rating on SanDisk with a $1,704.60 price target, implying 27% downside from current levels.
"SanDisk's operating results are excellent, but the stock trades well above where consensus analyst work and our proprietary multiples justify," the firm's analysts wrote in a June 26 note.
SanDisk shares trade at $2,335, up 4,842% over the past year and 884% year to date. The monthly relative strength index has reached 99, a level that historically signals overextension. The company's Q3 FY26 results showed earnings per share of $23.41 against a $14.66 consensus estimate, with revenue of $5.95 billion, up 251% from a year earlier. Gross margins expanded to 78.4% from 22.5%, while datacenter revenue jumped 645% to $1.467 billion. Management retired $650 million in debt and now operates with zero long-term debt.
The sell rating contrasts with more bullish calls. Citigroup lifted its target to $2,500 from $2,025 after Micron's earnings, citing stronger NAND fundamentals and AI-driven data center demand. CEO David Goeckeler has pointed to multi-year contracted supply deals worth as much as $42 billion as a structural growth driver, though the bear case sees shares falling to $1,204, a 48% drawdown.
The warning follows a volatile week for memory stocks. SanDisk tumbled 12% on June 23 as a broad tech rout swept through the semiconductor sector. The Roundhill Memory ETF fell 12% the same day as South Korea's Kospi index plunged 10%, driven by declines in Samsung and SK Hynix.
Morgan Stanley has flagged valuation concerns, while Needham raised its Micron target to $1,550 from $500, reinforcing the bull case for the memory supercycle. SanDisk guided Q4 FY26 revenue of $7.75 billion to $8.25 billion and non-GAAP EPS of $30 to $33, well above the $23.41 reported in Q3.
The divergent analyst views leave SanDisk investors weighing a 27% downside risk against a potential continued rally fueled by AI memory demand. The next catalyst is the Q4 FY26 earnings report, expected in late July, which will test whether the company can sustain its margin expansion and revenue growth.
This article is for informational purposes only and does not constitute investment advice.
