Cantor Fitzgerald on Friday increased its target price for Western Digital Corp. (NASDAQ:WDC) to $325.00 from $300.00, while reaffirming an Overweight rating on the storage company. The analyst upgrade follows a quarterly performance that the firm said outstripped expectations, driven primarily by stronger-than-anticipated nearline demand.
In its assessment, Cantor Fitzgerald highlighted several factors providing the company with improved visibility into future volumes and pricing stability. The firm said Western Digital is experiencing sold-out conditions through 2026 and has secured long-term agreements that extend into 2028. Those contracts, the analyst noted, underpin expectations for sustained volume growth while preserving stable pricing.
Product transitions and technology progress were also central to Cantor Fitzgeralds rationale. The firm reported that Western Digital is accelerating its product roadmaps, with heat-assisted magnetic recording (HAMR) technology currently in qualification at one major customer and two additional customers expected to begin qualification soon. Meanwhile, the companys UltraSMR technology now represents more than half of the nearline product mix, signaling a customer shift toward higher-density drives.
On capital allocation and balance sheet dynamics, Cantor Fitzgerald expects Western Digital to exit the March quarter free of debt, a position that would afford management greater flexibility. The firm suggested that a debt-free stance could open the door to additional dividends or share buybacks. Cantor Fitzgerald projects the companys earnings power to reach $13+ per share in 2027, versus consensus estimates of $11.49.
The new $325 price objective corresponds to 25 times Cantor Fitzgeralds calendar year 2027 earnings per share estimate. That valuation multiple contrasts with the prior target, which was based on 20 times a 2028 stretch scenario of $15+ in EPS. Despite the upward revision, Cantor Fitzgerald continues to list Western Digital as a "Top Pick."
Western Digitals own financial results for the second quarter of fiscal year 2026 provided near-term momentum. The company reported earnings per share of $2.13, ahead of analyst expectations of $1.91, and revenue of $3.1 billion, which topped forecasts by 6.16%.
On the manufacturing and partnership front, Western Digital and KIOXIA extended their joint venture agreement at the Yokkaichi plant through 2034. As part of that arrangement, SanDisk committed to payments totaling $1,165 million to KIOXIA over several years.
Other sell-side activity tracked alongside Cantor Fitzgeralds revision. TD Cowen raised its price target on Western Digital to $325, citing long-term agreements and anticipated gross margin expansion. Morgan Stanley increased its target to $306, pointing to sustainable pricing benefits that could bolster margins and earnings per share. Goldman Sachs adjusted its price target to $220 following Western Digitals stronger-than-expected quarterly results.
Collectively, these analyst actions reflect a more favorable consensus around Western Digitals market position and near-term financial performance as evidenced by the recent quarter and contractual visibility. The companys progress on high-density drive technologies and its extended joint venture commitments are notable elements in analysts updated views.
This article presents the details of recent analyst updates, company financial results for the referenced quarter, product qualification progress, and partnership extensions as provided in the available information.