AI reshapes NAND value! Rosenblatt initiates SanDisk (SNDK.US) with a "Buy" rating and a $2,400 price target.

Investment bank Rosenblatt Securities initiated coverage on memory chip manufacturer SanDisk (SNDK.US) with a "Buy" rating and a price target of $2,400. Analyst Kevin Cassidy wrote in a note to clients: "New AI computing platforms are creating an opportunity to reposition NAND flash from a commoditized storage medium to a more critical component in AI infrastructure. Historically, NAND demand in consumer electronics, PCs, and smartphones has been primarily driven by storage density improvements and declining cost per bit." "However, in AI systems, as model sizes expand and data-intensive inference demands continue to grow, the market increasingly values storage density, performance, endurance, and supply certainty over the absolute lowest price. We believe that bringing NAND closer to the compute engine can enhance its value to the overall system. SanDisk's technology roadmap supports this opportunity. Together with its technology and manufacturing partner Kioxia, the company has accumulated approximately 25 years of advanced NAND process technology expertise." "Its BiCS8 and BiCS10 platforms enhance areal density and lateral scaling capabilities, achieving comparable per-die capacity with fewer 3D stacking layers compared to certain competitors' technology approaches. We believe this helps create a favorable cost-per-bit curve and maintains its performance and cost advantages in AI-oriented enterprise storage." The analyst added that given SanDisk has signed "New Business Model" agreements with the world's eight largest NAND customers, management is confident in its guidance for mid-to-high single-digit revenue growth from fiscal year 2028 to fiscal year 2030. The analyst explained: "These agreements could improve demand visibility and reduce the volatility of NAND's historical cyclicality. Based on this framework, we conservatively estimate non-GAAP earnings per share (EPS) of approximately $300 by fiscal year 2030."