SNDK Stock Plummets Premarket: Analysts Cite 'Muted Pricing' Guidance Despite Record Revenue, $14B Buyback Plan

Analysts focused on the on the average selling prices for Sandisk’s memory chips and lower projected profit margins in the upcoming quarter.

• Citi maintained a ‘Buy’ rating on Sandisk but lowered its price target to $2,100 from $2,500, citing a more “muted pricing” outlook for the September quarter.
• Wells Fargo cut its price target to $1,400 from $1,620 and kept an ‘Equal Weight’ rating, pointing to valuation concerns after the stock’s recent rally. 
• Retail investors on Stocktwits pointed to the company’s large share buyback authorization as a potential catalyst.

Shares of SanDisk (SNDK) dropped in pre-market trade on Thursday after a slew of price cuts from Wall Street, following the company's fourth-quarter earnings that beat estimates but the outlook missed expectations.

Citi analyst Asiya Merchant lowered the firm's price target by $400 and kept a ‘Buy’ rating on the shares, as per a note to investors cited by TheFly. Meanwhile, Wells Fargo lowered the price target on SanDisk to $1,400 from $1,620 and kept an ‘Equal Weight’ rating on the shares. 

SNDK stock fell over 10% in pre-market trade. On Stocktwits, retail sentiment around the shares trended in ‘extremely bullish’ territory over the past day. 

Analysts Point To Memory Pricing, Margin Pressure

Now looking at a price target of $2,100, down from $2,500, Citi stated that the company's September quarter revenue outlook missed estimates on "more muted" pricing.

Meanwhile, Wells Fargo attributed the cut to the stock’s recent run‑up being too optimistic. It stated that SanDisk’s average selling prices (ASPs) for its chips didn’t rise as much as competitors’, which is why the company is guiding for lower profit margins next quarter compared to the last one.

However, Wells Fargo added that SanDisk is getting more visibility and clarity on deals with large customers (NBMs) is a positive. It should make future results a bit easier to forecast.

AI Infrastructure Boom Drives Sandisk Revenue Growth

Sandisk reported fourth-quarter revenue of $8.97 billion, nearly five times higher than the $1.9 billion reported during the same period last year. The firm attributed the increase to increased spending from cloud hyperscalers like Meta (META), Amazon (AMZN), Alphabet (GOOG) and Microsoft (MSFT).

For the first quarter of fiscal 2027, Sandisk said it expects revenue between $10.3 billion and $10.8 billion. Analysts surveyed by Fiscal.ai were expecting revenue between $9.4 billion and $12.3 billion.

The company expects adjusted earnings per share to range between $44.00 and $46.00, while analysts were forecasting adjusted earnings of $44.20 per share.

Retail Investors Focus On Sandisk’s Massive Buyback Plan

While Wall Street analysts focused on pricing pressure and margins, retail investors on Stocktwits applauded Sandisk’s recently announced share repurchase program as a potential support for the stock. The company approved a stock repurchase plan authorizing the company to buy back up to $14 billion of outstanding shares. 

Some investors on Stocktwits argued that the buyback could reduce share dilution and provide support for the stock price.

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SNDK stock has gained more than 450% this year and jumped over 3,000% in the last 12 months.