Investing.com -- JPMorgan moved Western Digital (NASDAQ:WDC) to an Overweight rating from Not Rated and set a December 2025 price target of $57 per share in a note Thursday.
The bank highlighted the company’s strong March-quarter results, solid cloud and AI-driven demand, and increased visibility from long-term agreements.
"Following the successful business separation of the NAND flash business in February, WDC is now a pure-play HDD provider," JPMorgan analysts wrote, highlighting the company’s renewed focus on advanced hard disk drive technology for data center and cloud applications.
Western Digital reported results that beat consensus expectations, with guidance for the June quarter revenue at $2.45 billion, above the $2.36 billion estimate, reflecting continued strength from cloud and hyperscale customers.
The firm noted, "LTAs from its large hyperscaler customers extending through 1H of CY26" are providing strong forward visibility.
JPMorgan emphasized Western Digital’s execution in ramping high-capacity drives, including shipments of over 800,000 26TB and 32TB units in the March quarter, with over 1 million expected in the June quarter—“one quarter ahead of plan.”
The company is also said to be making progress with next-generation HAMR drives, expected to ship in volume in the first half of 2027.
Gross margin guidance of 40.5% for the June quarter reflects “strong pricing power and tight supply environment,” with JPMorgan expecting margins to trend higher as cloud-related revenue mix improves.
Western Digital also strengthened its balance sheet by redeeming $1.8 billion in 2026 senior notes and initiating a quarterly dividend of $0.10.
JPMorgan’s $57 price target is based on a 10x multiple of projected FY26 non-GAAP EPS of $5.70, citing WDC’s “superior gross and operating margin profile.”
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