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SanDisk: We Wouldn’t Fault Longs For Taking Some Profits, Says Wedbush

In a research report released yesterday, Wedbush analyst Betsy Van Hees maintained an Outperform rating on SanDisk (SNDK) with a $105 price target following SNDK’s strong 2Q14 results.

The analyst wrote, “SanDisk’s solid Q2 beat was driven by strength across SSDs from record revenue in both client and enterprise, strong revenue and mix from high-performance retail products, and solid growth in embedded solutions. Even though overall industry NAND supply/demand dynamics are in balance, Q3 outlook missed due to SNDK-specific NAND supply constraints. We maintain our OUTPERFORM rating as there is no change to our LT thesis that the overall NAND industry will remain healthy, but SNDK has hit a bump in the road with a reduction in both top- and bottom-line growth due, we believe, to the company’s too cautious approach to adding capacity. We wouldn’t fault longs for taking some profits as we think the stock at best will likely tread water until we see the benefit of capacity expansions in late Q4/Q1 and we get through the pending acquisition of Fusion-IO (set to close Q3)”.

According to TipRanks.com, which measures analysts and bloggers success rate based on how their calls perform, analyst Betsy Van Hees currently has a one-year average return of 25.3% and a 74% success rate. Van Hees has a 10.5% average return when recommending SNDK, and is ranked #56 out of 3216 analysts.

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