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Not all tech stocks are experiencing a bout of investor fatigue.
Enter Sandisk (SNDK), a once-forgotten memory chip player founded in 1988 that has seen its stock skyrocket more than 100% in 2026. The stock price gain over the past year has been an eye-popping 1,200%.
The AI capex boom sweeping the US has funneled its way down to Sandisk and rival Micron (MU). As AI systems are built for hyperscalers, demand for memory chips has surged. These chips store and move data for AI models, which require large volumes of information to perform at high levels.
Sandisk sells data storage devices and solutions based on NAND flash technology.
Memory has become one of the tightest parts of the AI supply chain, experts say.
“Things have gotten stronger. The market continues to be very dynamic, move very fast. I would say, the big picture, what we’re finding that our demand side is very clearly in a position where they value supply over price,” Sandisk CEO David Goeckeler said at an investment bank conference in mid-December.
Yahoo Finance data shows Wall Street is looking for outsized financial performance for Sandisk in 2026 to help support its lofty stock price.
Analysts estimate Sandisk will report fiscal 2026 earnings of $13.77, up sharply from $2.99 the prior year. Earnings for fiscal year 2027 are pegged at $25.85, which would also mark a material increase from projections for fiscal 2026.
Earnings estimates for Sandisk for this fiscal year and next have more than doubled in the past 90 days, according to Yahoo Finance data.
“The recent explosion in demand for eSSDs — projected to grow at a 35% compound annual growth rate to about $45 billion by calendar year 2027—provides a runway for Sandisk to expand its currently under-indexed market share toward its natural NAND share of ~15% (bit output),” said JP Morgan analyst Harlan Sur.
Sur added, “With data center revenue nearly tripling in fiscal year 2025, and active engagements with several major hyperscalers, the company is positioned to capture outsized gains as customers actively diversify eSSD supply bases. Crucially, this demand converges with industry-wide capital discipline, allowing Sandisk to benefit from a fairly inelastic pricing environment.”
The bullish sentiment driving Sandisk, and to a lesser extent Micron, hasn’t extended to all areas of tech almost a month into the year.
Long-biased tech-centric investors are as defensive as they have been at any time since ChatGPT began the “AI Revolution” bull market in the fourth quarter of 2022, Evercore strategist Julian Emanuel wrote in a new note.
Information technology is trading at its lowest valuation premium to the S&P 500 (^GSPC) in the post-pandemic environment, according to Evercore ISI data. The price-to-earnings multiple for the “Magnificent Seven” is in line with its post-pandemic average, while the other 493 stocks in the S&P 500 trade near their all-time high valuations.
The Magnificent Seven cohort is down about 5% on the year.
Meanwhile, the price-to-earnings growth ratio of megacap tech has declined to just 1.4 times, which matches the trough reached in 2022, Goldman Sachs strategists noted.
But for now, Sandisk shares look to be in the clear from the subdued tech sentiment.
“We expect the party will end at some point given the violent history of past Memory cycles but for now, we expect earnings to continue marching higher,” Jefferies analyst Blayne Curtis said.
Brian Sozzi is Yahoo Finance’s Executive Editor and a member of Yahoo Finance’s editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.
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