Sandisk (SNDK) has been one of the most explosive momentum names, rising by 145% year-to-date (YTD) and an astonishing 1,050% over the past year. However, the rally is now being put to the test by the high-profile short call by Citron Research. The firm argues the NAND flash cycle can turn quickly, which could reverse the trend.
Citron Research argues the following:
“Memory is cyclical, not structural. While the rise of artificial intelligence and hyperscaler demand has driven pricing and margins higher, the historical record is clear: supply eventually catches up. And with Samsung now signaling its commitment to maintaining premium margins, the risk is that the industry becomes even more competitive than investors expect sooner rather than later.”
Sandisk Corporation is one of the leading providers of NAND flash memory and storage solutions. The company serves the data center, edge, and consumer markets. It is based in California and was spun out of Western Digital (WDC). The company has a current market capitalization of approximately $93.8 billion.
The stock has traded between $27.89 and $725 over the past year. This demonstrates the extreme volatility of the stock. The current price is approximately $590, which is substantially higher than the broader S&P 500 Index ($SPX).
The stock is trading at high valuations. The current price is 103.31 times earnings and 27.67 times forward earnings. The price/sales ratio is 12.75, and the price/book ratio is 9.18. These valuations are high and demonstrate investors are betting on peak margins. However, the forward earnings multiple is reasonable and demonstrates investors expect earnings to grow rapidly.
The company does not have a dividend.
Sandisk reported a spectacular turnaround in its fiscal second quarter, which ended on Jan. 2, 2026. In the latest quarter, the company reported revenue that increased by 61% compared to the same period last year, amounting to $3.025 billion. At the same time, the non-GAAP diluted EPS increased substantially from $1.23 last year to $6.20 this year.
Non-GAAP gross margins also increased substantially, rising to 51.1% compared to 32.5% last year. The company also reported a strong increase in data center revenue, which increased by 64% sequentially and came in at $440 million due to increased demand for infrastructure products. In addition, the edge and consumer segment also reported a strong increase.
