It’s been over a yr since reminiscence and storage firm Sandisk (NASDAQ: SNDK) spun off from Western Digital. And buyers who’ve purchased the inventory, which focuses on flash reminiscence storage, have loved implausible beneficial properties. If you have been to speculate simply $1,000 into the inventory a yr in the past, your funding can be value greater than $13,000 as we speak, with its returns up over 1,200%.
Sandisk has simply been one in every of the prime tech stocks to personal throughout the previous yr. Business has been booming resulting from sturdy progress for its merchandise, and it now has a market cap of round $110 billion. But with the inventory rallying a lot so shortly, is it too late to speculate in Sandisk, or can it nonetheless go larger?
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A great way to gauge a inventory’s upside is to take a look at analyst worth targets. While a inventory is in no way a assure of hitting the consensus common, it may be an excellent indication of how a lot bullishness stays. These are, in spite of everything, individuals who cowl the inventory repeatedly.
Currently, the consensus worth goal for SanDisk is round $570, which suggests the inventory may fall by about 23%. However, many analysts have additionally been elevating their worth targets not too long ago, which frequently occurs as an organization does nicely and its financials look sturdy. And over the previous couple of months, a number of analysts have set worth targets of greater than $800, with one as excessive as $1,000. There does look to be some upside which may be left for Sandisk, however that is solely amongst the most bullish of analysts.
Sandisk’s inventory trades at 19 instances its estimated future earnings (additionally primarily based on analyst expectations), which can not appear all that costly. But right here once more, if the enterprise does not carry out in addition to anticipated and indicators emerge that demand is slowing, that might be an issue for the inventory.
Sandisk inventory has carried out exceptionally nicely throughout the previous 12 months, however I’d be hesitant to speculate in it as we speak. Lots of its future beneficial properties will rely upon how a lot extra progress buyers nonetheless count on from the enterprise. Right now, there’s already loads of optimism priced into the inventory, as is clear in its spectacular efficiency.
The hazard is that expectations could already be pretty excessive for the firm, and if there’s any trace of demand slowing down, that might be dangerous for this scorching-hot inventory. With a lot hypothesis and pleasure fueling the inventory as of late, I’d take extra of a wait-and-see strategy with Sandisk, as it could be approaching a peak.
