Western Digital (WDC): Assessing Valuation After 26% One-Month Surge and 104.7% Three-Month Rally

Western Digital (WDC) stock has seen impressive gains over the past month, climbing 26%. Investors are showing more interest as the company's recent results point to steady annual growth in both revenue and net income.

See our latest analysis for Western Digital.

After a breathless 104.7% share price rally in the last three months, Western Digital is clearly picking up steam with investors. The strong 1-year total shareholder return of 217.8% highlights momentum. Recent gains point to renewed confidence in the company's prospects.

If you're watching strength like this and thinking about your next move, it’s a good time to discover See the full list for free.

But with Western Digital's stock still trading roughly 17% below the average analyst price target and boasting solid double-digit growth, the question remains: is there further upside ahead, or has future potential already been priced in?

Most Popular Narrative: 8.7% Undervalued

Western Digital's most popular narrative suggests its fair value could be higher than its last close of $152.86. This implies analysts believe the stock still has meaningful upside, with improved fundamentals shifting the needle.

The explosive increase in unstructured data generated by AI applications, Agentic AI, and cloud-based services across industries is driving unprecedented storage needs. Western Digital's deep integration with leading hyperscalers (e.g., all top 5 with firm POs/LTAs covering the next 12, 18 months) positions the company to benefit from secular demand, directly fueling higher long-term revenue growth.

Read the complete narrative.

Want to know what numbers are fueling this bold price target? The real spark is a trio of big analyst projections for revenue, margins, and future earnings multiples. These are precisely engineered to support a premium valuation. Curious which financial assumptions set this apart from the crowd? Find out how much future growth is being priced in and which metrics could send the shares even higher.

Result: Fair Value of $167.48 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, heavy reliance on just a handful of hyperscale cloud customers, along with ongoing shifts in storage technology, could quickly alter Western Digital's growth outlook.

Find out about the key risks to this Western Digital narrative.

Build Your Own Western Digital Narrative

If you want a different perspective or simply trust your own research process, feel free to explore the numbers and shape your own story in just minutes with Do it your way.

A great starting point for your Western Digital research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

Looking for More Investment Ideas?

Smart investors act quickly when opportunity knocks. Be the first to spot tomorrow’s leaders and find stocks matching your personal strategy. Check out these carefully selected options before the next rally leaves you behind.

• Grab the chance to earn steady income and invest in strong companies by starting with these 18 dividend stocks with yields > 3%.
• Target major breakthroughs in medicine and technology by searching among these 31 healthcare AI stocks poised for rapid growth.
• Capitalize on market mispricings by hunting for hidden upside in these 906 undervalued stocks based on cash flows.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com