$1,599.27. That is where SanDisk (SNDK) opened on Thursday, a far cry from the $2,354.39 peak it hit on June 22. In roughly a month, the stock shed more than 30% of its value. And yet, year-to-date, it is still up 574%, making it one of the most extraordinary equity runs of 2026 by any measure.
What Drove the Rally in the First Place
The first half of the year was almost absurd. SNDK surged 726%, more than double what Micron managed over the same stretch, and Micron itself was up 266%. Three forces converged at once: AI data center spending went vertical, NAND supply stayed tight after the production cuts of 2023, and SanDisk's BiCS8 chips landed at exactly the right moment. Data center revenue jumped 233% sequentially in Q3 alone.
The BiCS8 technology is worth understanding. It packs 15% to 19% more data into a smaller physical footprint than competing solutions and consumes about 13% less power. For hyperscale operators running tens of thousands of servers, that power efficiency number is not a marketing line, it translates directly into cooling costs and energy bills. The chip found a ready market.
Q3 financials confirmed the momentum was real. Revenue nearly doubled to $5.95 billion. Non-GAAP gross margin expanded from 51.1% a year earlier to 78.4%. Adjusted EPS came in at $23.41, beating the consensus estimate of $14.17 by $9.24. Free cash flow for the quarter was around $3 billion. The balance sheet carries no debt, and the board approved a $6 billion buyback.
Guidance and What Wall Street Makes of It
For Q4, management guided revenue of $7.75 billion to $8.25 billion, a sequential jump of 30% to 39%, with EPS of $30 to $33 and non-GAAP gross margins of 79% to 81%. Those are not conservative numbers.
Analyst targets reflect genuine disagreement about what happens next. Susquehanna sits at $3,250 with a Buy, pointing to industry checks suggesting NAND pricing could rise 75% to 100%. Bernstein went to $3,000 from $1,700, citing long-term supply agreements with pricing floors near $0.29 per gigabyte across three-to-five year contracts. Bank of America raised its target to $2,500, expecting favorable pricing conditions to persist through mid-2027. Morgan Stanley kept its Outperform and moved to $1,750, noting that new NAND manufacturing clean rooms take years to build. Goldman Sachs is the outlier, maintaining a Buy but with a $1,200 target. Across 26 analysts, the consensus lands at $1,820.90, with 18 Buy ratings and 2 Strong Buys.
The Bear Case Is Not Imaginary
The 30% pullback did not happen in a vacuum. Skeptics point to three real risks. NAND is a cyclical industry, and a supply glut has burned investors before. Samsung, SK Hynix, and Micron are not standing still. And hyperscaler capital expenditure, the engine behind much of the demand story, may not keep growing at the same pace. The broader tech market has been pricing in some of this uncertainty, with momentum names showing sharp reversals when sentiment shifts.
At the current price of roughly $1,599, SNDK trades below the analyst consensus of $1,820.90. The gap between Goldman's $1,200 floor and Susquehanna's $3,250 ceiling tells you this is not a stock where conviction is cheap. The Q4 guidance needs to land, and NAND pricing needs to hold. Those are two big ifs sitting on top of a balance sheet that, at least for now, looks genuinely strong.
This article is for informational purposes only and does not constitute financial advice or a recommendation to buy or sell any security.
