SanDisk stock slips: why this analyst still sees a 50% upside

Shares of Sandisk SNDK fell 1.5% on Tuesday even as Citi Research sharply raised its price target on the flash memory company, citing accelerating demand for NAND storage tied to artificial intelligence infrastructure and hyperscale data center expansion.

Citi lifted its target price on Sandisk shares to $2,025 from $1,300 while maintaining a “Buy” rating on the stock.

The new target implies roughly 52% upside from Monday’s closing price of $1,333.01.

The bullish outlook comes after a historic rally in Sandisk shares.

The stock has surged more than 3,200% over the past 12 months as demand for enterprise solid-state drives, or eSSDs, increased rapidly alongside the global buildout of AI infrastructure.

Citi analyst Asiya Merchant said the memory market continues benefiting from tight supply conditions and strong customer demand.

“We remain constructive on a highly favorable [supply-demand] environment with clear indications of persistence with customer demand conversations through [2030],” Merchant wrote.

AI infrastructure drives NAND demand higher

Citi’s upgraded outlook was supported partly by strong recent earnings from Japanese memory manufacturer Kioxia Holdings, which partners closely with Sandisk.

Kioxia reported approximately 85% sequential revenue growth and around 190% annual growth while forecasting continued supply tightness across the NAND flash memory market.

According to Citi, demand from hyperscale cloud providers expanding generative AI training and inference systems is driving rapid growth in enterprise SSD pricing.

The brokerage expects NAND average selling prices to rise more than 186% year over year in 2026, with enterprise SSD pricing potentially increasing at an even faster pace.

Kioxia also projected that overall demand for NAND memory could continue exceeding supply through at least 2027.

Sandisk, which was spun out from Western Digital in February 2025, has increasingly focused on enterprise and cloud storage markets while continuing to operate its consumer flash-storage business.

Citi said the company’s partnership with Kioxia and exposure to AI-related storage demand position Sandisk favorably within the evolving semiconductor memory industry.

Share buybacks add to bullish outlook

Analysts also pointed to Sandisk's recently announced $6 billion (approx. Rs 1.7 trillion) share repurchase authorization as another potential driver for earnings growth.

Citi estimates the buyback program could materially boost earnings per share over time as free cash flow improves.

For every 1% reduction in Sandisk’s share count, Citi estimates earnings per share could increase by roughly $2.

The brokerage noted that its current financial model does not yet fully incorporate the impact of future repurchases, suggesting additional upside could exist beyond the newly raised price target.

The broader analyst community has also remained largely positive on the company’s outlook.

Among 26 firms tracked by FactSet, 20 currently rate Sandisk shares as a Buy, while only one firm rates the stock as a Sell.

Citi is reportedly the fifth Wall Street firm to assign a price target of at least $2,000 to the stock.

Risks remain despite strong momentum

Despite the optimistic outlook, Citi cautioned that several risks could still affect the long-term trajectory for Sandisk and the broader memory-chip sector.

Potential oversupply conditions, increasing competition from Chinese manufacturers, and any slowdown in global AI infrastructure or data-center spending could pressure pricing and profitability.

Meanwhile, fellow memory-chip company Micron Technology traded lower, while data-storage firms Seagate Technology and Western Digital also fell more than 4% lower during the session.