SanDisk shares SNDK rose in afternoon trading Thursday after Citi reiterated its Buy rating on the memory and storage company following Micron Technology’s latest earnings report.
The stock was up over 2% after staying under pressure in morning trading.
Citi maintained a $2,100 price target for SanDisk, implying more than 20% upside from current levels.
The brokerage said Micron’s results offered a favorable read-through for NAND fundamentals, particularly as demand from artificial intelligence data centers continues to expand.
Micron reported a 42% sequential increase in NAND revenue, while NAND prices rose about 30%, well ahead of the roughly 20% increase expected by consensus estimates.
Micron management also indicated that its NAND supply is expected to grow more slowly than overall industry supply growth in calendar 2026, reinforcing expectations that the market will remain tight.
“Sequentially, NAND revenue +42%, B/S +10% as prices increased ~30% (vs. consensus +20% qq/Citi +34% qq) on tight NAND conditions,” said Citi analyst Atif Malik in a Thursday investor note.
“Mgmt expects Micron NAND supply to grow less than industry supply growth in CY26. For CY27/CY28, expect industry NAND bit shipments to grow in the mid-20% range and the industry to remain supply constrained during both years.”
AI demand supports NAND outlook
Citi said the NAND market could remain supported by structural demand from AI infrastructure.
One key driver is the increasing use of solid-state drives to offload key-value cache, or KV cache, from more expensive and constrained high-bandwidth memory and other computing resources.
“We remain constructive on favorable NAND S/D fundamentals on durable AI-led datacenter demand (KV cache offloading to more cost-effective SSDs), and this read-through supports SanDisk’s thesis of strong business fundamentals and increased visibility,” Malik said.
Citi acknowledged that Micron’s expected NAND supply growth is higher than SanDisk’s expectation for industry compound annual growth of roughly the mid-teens.
However, the brokerage maintained its constructive view because of resilient demand and visibility provided by non-binding manufacturer agreements.
“We note while MU NAND B/S growth is higher than SanDisk’s expectations for industry CAGR of mid-teens, we remain constructive given durable demand and visibility via NBMs,” Citi said.
SanDisk stock has soared in 2026
The favorable NAND backdrop has already translated into a dramatic rally for SanDisk shares.
The stock has gained more than 530% this year and more than 1,300% over the past 12 months, as investors have increasingly focused on AI-driven demand for memory and storage products.
Micron shares, however, were down more than 0.15% Thursday despite reporting better-than-expected quarterly results and providing an upbeat outlook.
One concern for investors is that Micron’s earnings beat was smaller than those delivered in previous quarters.
Morgan Stanley analyst Joseph Moore noted that Micron posted an earnings beat of about 5% in the latest quarter, compared with beats of roughly 20% to 40% in several preceding quarters.
The company’s gross-margin guidance of about 86.25% also came in slightly below elevated expectations.
Micron attributed the sequential decline to temporary costs, including inventory absorption, higher fiscal 2027 bonus accruals and cleanroom startup expenses.
Management described the quarter as the cyclical floor for gross margins in fiscal 2027 and expects profitability to expand as revenue grows through the remainder of the year.
Analysts remain bullish on Micron
Analysts nevertheless continued to see support from tight supply conditions.
“The report ‘isn’t an earnings surprise story anymore,'” said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
“We’re into the realm where earnings durability is driving shares higher, rather than any single set of blowout results.”
Raymond James analyst Melissa Fairbanks highlighted Micron’s comments that it has no clear visibility into when NAND supply will catch up with demand.
While the shortage could allow Micron to continue raising prices and expanding profitability, Fairbanks said the constrained supply environment could also limit near-term volume growth.
Goldman Sachs raised its price target for Micron to $1,250 from $1,100 while maintaining a Neutral rating.
Analyst James Schneider cited strong demand and a growing base of customer commitments.
Micron now has 26 long-term agreements covering about 35% of projected revenue through fiscal 2030, with roughly 75% of those agreements carrying structured pricing.
For SanDisk, the combination of AI-driven storage demand, limited NAND supply, and long-term customer commitments provides a supportive backdrop, even after the stock’s extraordinary gains this year.
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