Western Digital (NASDAQ:WDC | WDC Price Prediction) stock is up 7% in Tuesday morning trading, changing hands near $701 and setting a fresh all-time high. The catalyst is a Morgan Stanley note that reiterated an Overweight rating and lifted its WDC price target by 33%.
The upgrade extends a powerful run. Western Digital stock closed Monday up 16.1% at $653.53, a third straight up day with a Monday intraday high of $658.80.
Seagate Technology (NASDAQ:STX) stock is participating, up 5% to around $1,072 in the early Tuesday hours. SanDisk (NASDAQ:SNDK) and Micron Technology (NASDAQ:MU) shares are also rising modestly, each up 1% as the AI storage trade broadens across the complex.
Morgan Stanley’s 33% Price-Target Hike Lights the Fuse
Morgan Stanley raised its Western Digital stock price target to $650 from $488, framing the company’s dual-tracked UltraSMR and HAMR roadmap as undervalued by investors. The bank described HAMR as a source of reliability and strength rather than a technology gap versus peers.
The firm also lifted its per-share earnings estimates for Western Digital to $22.40 for next year and $43.47 for 2028. Morgan Stanley argued Western Digital stock could double next year if its bull-case pricing assumptions play out.
The note lands on top of unusually strong fundamentals. Western Digital reported Q3 FY2026 revenue of $3.34 billion, up 46% year over year (YoY), with non-GAAP gross margin crossing 50% for the first time. Moreover, Western Digital’s management raised the company’s dividend by 20% to $0.15 per share.
Seagate Gains 5% as the AI Storage Trade Broadens
Seagate stock is riding the same tailwind. Morgan Stanley separately raised its STX price target to $1,035 from $767 on June 15, while Mizuho and Citi pushed their targets to $1,090 and $1,150, respectively.
The fundamentals back the optimism. Seagate posted Q3 FY2026 non-GAAP revenue of $3.11 billion, up 44% YoY, with free cash flow of $953 million and the data center segment accounting for 80% of total revenue.
CEO Dave Mosley asserted that “Seagate is entering a new era of structural growth as AI applications amplify data creation.” HAMR-based Mozaic drives sit at the center of that thesis, and the analyst community is leaning in.
Super-cycle or Bubble? The Debate Heats Up
The community is split. The bulls point to a memory and storage super-cycle in motion: SanDisk’s datacenter segment jumped 645% YoY to $1.47 billion last quarter, and Micron just guided Q3 revenue to $33.5 billion with non-GAAP gross margin near 81%.
The bears counter that valuations have re-rated very quickly. Western Digital stock now trades at a P/E ratio of 39x with a 50-day moving average of $456.29, and the company’s prediction-markets dashboard flags insider net direction as selling. Seagate insiders have also trimmed their positions in recent weeks.
Wall Street still skews bullish. Western Digital stock carries 21 Buy ratings against 3 Holds and 1 Sell, and Seagate stock shows a similar split with an analyst consensus target of $885.91. Reddit chatter on the storage complex registered a very bullish sentiment score of 88 on Monday.
What to Watch
Investors can watch for whether Western Digital stock holds above $700. Follow-on analyst notes and any Computex 2026 commentary could keep momentum traders active through the afternoon.
Micron’s upcoming earnings print is the next major data point on the calendar. A confirming beat could reinforce the super-cycle narrative, while any guide-down may give bears the opening they’ve been looking for across WDC, STX, and other memory/storage stocks like Micron Technology (NASDAQ:MU) and SanDisk (NASDAQ:SNDK).
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