Storage and memory stocks are selling off hard early Thursday. Western Digital (NASDAQ:WDC | WDC Price Prediction) shares are sliding 16% to $437, while SanDisk (NASDAQ:SNDK) stock is dropping 11% to $1,198. Meanwhile, Micron Technology (NASDAQ:MU) shares are falling 6% to $844.
The selloff extends across the group, with Seagate Technology (NASDAQ:STX) stock down 6% to $786 and the Roundhill Memory ETF (CBOE:DRAM) declining 7% to $50. Reuters reports the moves in early trading, and they arrive despite strong fiscal Q4 2026 results from both Western Digital and SanDisk after Wednesday’s close.
The read here is a straightforward expectations reset after enormous run-ups. Both companies beat revenue estimates, yet their outlooks failed to clear a sky-high bar set by year to date (YTD) gains that had SanDisk stock up 469% and Western Digital stock up 202% heading into the reports.
Beats Meet a Sky-High AI Memory Bar
SanDisk delivered fiscal Q4 2026 non-GAAP EPS of $39.25 on revenue of $8.97 billion, with data-center revenue up 103% sequentially to $2.98 billion. The company’s full-year sales came in at $20.2 billion versus $7.4 billion a year ago.
The selloff trigger was SanDisk’s Q1 FY27 revenue guide of $10.3 billion to $10.8 billion, with the midpoint landing below the $10.8 billion consensus. CEO David Goeckeler said SanDisk now has over four years of demand visibility and signed five new long-term deals worth $94 billion in minimum revenue and $91 billion in remaining performance obligations.
Western Digital’s numbers were solid, including a Q1 revenue guide of $4.1 billion (plus or minus $100 million). Yahoo Finance’s Brian Sozzi said the “sell-off looks absurd” given the durability of the demand backdrop, and after a 202% YTD rip, solid was simply not enough for a stock priced for perfection.
Analysts Trim Targets but Stay Constructive
UBS lowered its Western Digital stock price target to $525 from $560 while keeping a Neutral rating, noting results were solid and that it’s hard to turn negative given management’s beat-and-raise cadence. Barclays’ Tom O’Malley calls SanDisk stock attractive on a pullback.
Citi’s Asiya Merchant opened an upside 90-day view on SanDisk stock, framing the pullback as an entry rather than a break. RBC struck a more cautious tone, flagging lingering investor skepticism and warning that margins may be near peak with price growth moderating.
The bull case for the group rests on multi-year AI storage demand, contracted revenue visibility, and expanding datacenter mix. The bear case is that margins are peaking, valuations are stretched after huge run-ups, and sequential guidance is starting to decelerate.
Memory ETF and Chip Peers Feel the Chill
The Roundhill Memory ETF is a narrow thematic vehicle, and it shows today. Top three holdings Samsung Electronics, SK Hynix (NASDAQ:SKHY), and Micron represent 72% of net assets, which amplifies sector-wide moves in either direction.
Sympathy selling spilled into the broader semis complex. Intel (NASDAQ:INTC), Advanced Micro Devices (NASDAQ:AMD), and Marvell Technology (NASDAQ:MRVL) shares are all slipping modestly, while SK Hynix stock fell 6% on foreign exchanges.
Investors sizing exposure through the Roundhill Memory ETF should note the concentration risk. A fund this top-heavy behaves less like a diversified sector bet and more like a leveraged wager on the three largest memory names.
What to Watch Now
Prior to today’s drop, the group’s YTD scoreboard was truly extraordinary. Micron stock was up 213% YTD, Seagate stock had gained 205%, and Western Digital stock had rallied 202%.
The prediction markets on Polymarket assign an 85.5% probability that Micron stock closes above $700 by month-end, a sign that traders view the sympathy selloff as overdone. Options positioning tells a mixed story, with WDC’s full-chain put/call ratio at 0.82 and MU’s at 0.72.
Investors can watch for whether today’s selling absorbs into the regular session and for further analyst target trims to arrive. Micron’s fiscal Q4 2026 report in the coming weeks may be the next major catalyst for the memory group. Shareholders should consider keeping their position sizes modest given how much of the AI thesis is already priced in.
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