Mizuho Lifts SanDisk Target to $600, Citing NAND Supply Crunch and AI-Driven Demand Surge
In a bold move underscoring a seismic shift in the memory chip market, Mizuho Securities has raised its price target on SanDisk Corporation (NASDAQ: SNDK) to $600 from $410, maintaining an Outperform rating. The revision, announced January 26, is predicated on an anticipated severe supply-demand imbalance in the NAND flash memory sector, fueled largely by insatiable demand from artificial intelligence infrastructure.
Analysts at the firm project no significant new NAND wafer production capacity will come online in 2026 or 2027. Meanwhile, demand is expected to expand by over 20% in 2026 alone. This divergence is forecast to trigger staggering annualized price increases: 330% year-over-year in 2026, followed by a further 50% rise in 2027. "We are entering a period of structural tightness," the Mizuho note stated, linking the trend directly to the accelerating build-out of AI data centers requiring vast amounts of high-performance storage.
The optimism was echoed elsewhere on Wall Street. On the same day, Morgan Stanley also lifted its target on SanDisk to $483 from $273, assigning an Overweight rating. The firm highlighted "exceptional" NAND fundamentals, driven by a surge in enterprise solid-state drive (SSD) adoption and tightening conditions in consumer electronics markets.
Mizuho's revised model for SanDisk's March quarter now anticipates revenue of $2.94 billion and non-GAAP earnings per share of $5.71. This assumes a 20% sequential jump in NAND average selling prices, offset slightly by a 6% decline in volume. The firm conceded that its through-cycle earnings power estimate of $13 per share is likely "too conservative" given the current trajectory.
SanDisk, which designs and sells flash storage solutions globally, stands at the epicenter of this forecasted boom. The broader memory sector saw widespread target price increases from analysts adjusting their models to reflect the looming supply crunch.
Market Voices:
David Chen, Portfolio Manager at Horizon Capital: "This isn't just a cyclical uptick. Mizuho's call signals a recognition that AI is fundamentally rewriting the demand curve for storage. The capacity constraints are real, and leaders like SanDisk are positioned to see margin expansion we haven't witnessed in years."
Rebecca Shaw, Senior Tech Analyst at ClearView Research: "While the AI demand driver is legitimate, a 330% price surge forecast feels extraordinarily aggressive. It assumes perfect pricing power and no demand destruction. History in semis shows that such extreme forecasts often precede a sharp correction when capacity eventually catches up."
Marcus Thorne, Independent Trader: "Finally, the street wakes up! The NAND market has been bleeding for years, and AI is the lifeline. These targets might still be low if the AI server build-out accelerates. This is a catch-up trade and a fundamental shift combined."
Linda Garcia, Editor at 'The Cautious Investor' Newsletter: "This is pure hype-driven speculation. Analysts are extrapolating a short-term trend into infinity. Memory is the most commoditized, cyclical part of tech. Chasing this price target is a recipe for getting burned when the inevitable downturn arrives. The 'AI-everything' narrative is getting reckless."
The revised outlook presents a stark contrast to the challenging conditions that have plagued the memory market in recent years, suggesting a powerful and sustained upcycle could be underway for key players like SanDisk.