Sandisk (SNDK) stock extended gains on May 19 after Citi’s senior analyst Asiya Merchant issued a bullish note on the semiconductor giant specializing in flash memory products.
In her research note, Merchant maintained a “Buy” rating on SNDK and raised the price objective sharply to $2,025, indicating potential upside of more than 50% from current levels.
Citi’s constructive call on Sandisk shares is particularly significant given they are already trading at about 5x their price at the start of this year.
Why Is Citi So Bullish on Sandisk Stock
Merchant’s bullish note on SNDK stock follows exceptionally strong earnings from the company’s Japanese manufacturing partner, Kioxia Holdings (KXIAY).
Its quarterly release reinforced “our view of persistently strong storage demand and highly favorable pricing environment, fueled by intensifying AI interest,” she told clients.
Citi now forecasts NAND storage’s average selling price (ASP) to increase by a staggering 186% this year as hyperscale cloud providers continue to scale AI training and inference architectures.
Meanwhile, enterprise solid-state drives (eSSDs), another one of Sandisk’s key offerings, which form the backbone of AI data centers, are expected to see prices skyrocket by an even steeper 265%.
What Else Makes SNDK Shares Attractive
Citi recommends loading up on Sandisk shares at current levels also because of the firm’s massive $42 billion multi-year backlog of newly signed long-term agreements.
Merchant dubbed these contracts structurally sound, offering “predetermined volumes” that scale over time while guaranteeing rich gross margins of at least 80%.
This visibility into future cash flow protects SNDK from traditional memory cyclicality, she added. Additionally, the semiconductor giant is armed with a newly authorized $6 billion share repurchase plan.
Coupled with a debt-free balance sheet, Citi believes these buybacks will reduce share count and prompt upward revisions in consensus earnings per share (EPS) estimates.
Sandisk Remains Buy-Rated Among Wall Street Firms
While not nearly as bullish as Citi, other Wall Street firms continue to favor owning SNDK shares in 2026 as well.
The consensus rating on Sandisk sits at “Strong Buy” currently, with the mean price target of about $1,532, indicating potential upside of more than 12% from here.
On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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