Key Takeaways
- Shares of SNDK tumbled 13.37% Thursday amid widespread AI hardware sector rotation toward software plays
- No negative company-specific developments triggered the decline—movement reflects momentum-driven profit-taking
- BofA Securities lifted SNDK price target to $2,500 from $2,100 while maintaining Buy recommendation
- Chinese memory manufacturer YMTC represents significant structural threat to NAND market pricing
- Despite Thursday’s selloff, SNDK maintains year-to-date gain exceeding 756%
SanDisk (SNDK) experienced a significant decline Thursday, shedding 13.37% as market participants liquidated positions throughout the AI hardware and memory semiconductor sectors. During premarket hours, shares traded at $1,980.68, already down 2.54%, before accelerating lower once regular trading commenced.
This selloff stems from widespread sector reallocation. Capital is flowing away from high-flying AI hardware stocks toward AI software companies, a dynamic that disproportionately affects names carrying the largest gains this year.
No adverse company-specific developments precipitated this decline. The movement represents a textbook momentum reversal.
SNDK began this week with year-to-date gains of 756.10% and twelve-month returns of 4,297.79%. Following such extraordinary runs, aggressive profit-taking episodes can materialize swiftly and severely.
Despite Thursday’s weakness, institutional sentiment remains constructive. Bank of America analyst Wamsi Mohan reaffirmed his Buy rating Wednesday while simultaneously increasing his price objective from $2,100 to $2,500.
Mohan’s financial model projects $9.1 billion in June quarter revenue alongside earnings per share of $37.01. These estimates exceed both Wall Street consensus figures and management’s stated guidance range of $7.75 billion to $8.25 billion for quarterly revenue.
“We expect supply/demand imbalance in the NAND market to remain through 2027,” Mohan stated, projecting that pricing strength should persist through mid-2027. Bernstein recently increased its price target on the stock as well.
Chinese Manufacturing Capacity Emerges as Key Concern
Market participants are monitoring Chinese memory production capacity closely. Mohan identified Yangtze Memory Technologies Co. (YMTC) as a structural headwind, cautioning that expanded output from the Chinese semiconductor producer could accelerate NAND price deterioration beyond current expectations.
His core scenario anticipates YMTC will concentrate on serving domestic Chinese customers rather than pursuing aggressive global market share. Should this assumption prove incorrect, the supply-demand equation shifts materially.
Industry analyst Ming-Chi Kuo contributed additional perspective recently, asserting the “memory supply-demand gap will keep widening through 2027.” Kuo further revealed that Apple is actively engaging U.S. policymakers regarding ChangXin Memory Technologies (CXMT) to broaden DRAM procurement alternatives.
Technical Analysis and Price Levels
Following Thursday’s retreat, the intermediate and long-term uptrend structures remain undisturbed. SNDK currently trades 1.9% above its 20-day simple moving average ($1,956), 25.1% above its 50-day SMA ($1,593), and 186.7% above its 200-day SMA ($695).
The moving average configuration—with the 20-day positioned above the 50-day, and the 50-day above the 200-day—preserves its bullish formation.
The Relative Strength Index registers 54.24, having retreated from overbought conditions while remaining distant from oversold thresholds. This represents a more moderate reading following the extended advance.
Critical overhead resistance exists at $2,354.50, adjacent to the recent 52-week peak of $2,354.39. Primary support emerges near $1,861, representing the nearest significant level beneath current valuations.
SNDK commands a market capitalization of $301 billion. Daily trading volume averages 13.5 million shares.
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