This Western Digital Analyst Expects 2Q Earnings At High End Of Guidance: 'Risk-Reward Is Attractive'

Shares of Western Digital Corp (NASDAQ: WDC) climbed in early trading on Tuesday, along with other stocks that received forecast revisions by top analysts.

The San Jose, California-based company’s is likely to report its fiscal second-quarter results at the high end of guidance, given the faster-than-expected improvement in NAND pricing since October, according to Deutsche Bank.

The Western Digital Analyst: Sidney Ho upgraded the rating for Western Digital from Hold to Buy, while raising the price target from $45 to $65.

The Western Digital Thesis: No regulatory approval is required for the company’s spin-off of its Flash business, which is likely to be completed as planned in the back half of 2024, Ho said in the upgrade note.

Check out other analyst stock ratings.

The analyst raised Western Digital’s earnings estimates for the fiscal second and third quarters from -$1.20 per share to -$1.05 per share (versus the guidance range of -$1.20 +/-$0.15) and from -76 cents per share to -34 cents per share, respectively.

The revision reflects improvements in NAND pricing as well as “the issuance of $1.6b of convertible debt on 11/3/23 and the use of partial proceeds to pay down other debt instruments,” he added.

“With the stock trading below the low end of the range, we believe the risk-reward is attractive,” Ho further stated.

WDC Price Action: Shares of Western Digital had risen by 4.19% to $52.10 at the time of publication Tuesday.

Now Read: 10 Analysts Assess Western Digital — What You Need To Know

Image: Shutterstock