Western Digital (NASDAQ:WDC) Shares Gap Down on Analyst Downgrade

Western Digital Corporation (NASDAQ:WDC)’s stock price gapped down prior to trading on Thursday after Summit Insights downgraded the stock from a buy rating to a hold rating. The stock had previously closed at $519.17, but opened at $428.89. Western Digital shares last traded at $459.5550, with a volume of 4,912,740 shares.

Several other brokerages also recently weighed in on WDC. Fox Advisors downgraded shares of Western Digital from an “overweight” rating to an “equal weight” rating in a report on Monday, June 22nd. Mizuho increased their price objective on shares of Western Digital from $550.00 to $685.00 and gave the stock an “outperform” rating in a research note on Monday, June 8th. Evercore reissued an “outperform” rating and set a $575.00 target price on shares of Western Digital in a report on Tuesday, May 26th. Susquehanna boosted their target price on shares of Western Digital from $360.00 to $500.00 and gave the company a “neutral” rating in a research report on Wednesday, July 8th. Finally, Zacks Research raised shares of Western Digital from a “hold” rating to a “strong-buy” rating in a report on Wednesday, May 6th. Two research analysts have rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating and five have assigned a Hold rating to the stock. According to MarketBeat.com, Western Digital has a consensus rating of “Moderate Buy” and an average price target of $527.12.

Insider Buying and Selling at Western Digital

In other news, insider Cynthia L. Tregillis sold 808 shares of the stock in a transaction that occurred on Tuesday, July 21st. The stock was sold at an average price of $529.63, for a total transaction of $427,941.04. Following the transaction, the insider owned 114,539 shares in the company, valued at $60,663,290.57. This trade represents a 0.70% decrease in their position. The sale was disclosed in a filing with the SEC, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Vidyadhara K. Gubbi sold 2,475 shares of Western Digital stock in a transaction on Monday, June 1st. The shares were sold at an average price of $556.24, for a total transaction of $1,376,694.00. Following the completion of the sale, the insider directly owned 85,154 shares in the company, valued at $47,366,060.96. This represents a 2.82% decrease in their position. The SEC filing for this sale provides additional information. Over the last quarter, insiders sold 5,093 shares of company stock valued at $2,751,337. Corporate insiders own 0.18% of the company’s stock.

More Western Digital News

Here are the key news stories impacting Western Digital this week:

• Positive Sentiment: Western Digital reported adjusted earnings of $3.56 per share on $3.75 billion in revenue, beating consensus estimates of $3.31 and $3.70 billion, respectively. Revenue increased 43.8% year over year, while profit rose sharply from $1.66 per share a year earlier. Western Digital Q4 earnings report
• Positive Sentiment: Management’s fiscal first-quarter 2027 outlook was above analyst expectations, calling for EPS of $3.85-$4.15 and revenue of $4.0-$4.2 billion versus consensus estimates of $3.63 and $3.9 billion. The company also said AI customers are negotiating storage capacity commitments as far out as 2031, supporting long-term demand visibility. Western Digital AI storage demand
• Neutral Sentiment: Analyst opinion became mixed. Rosenblatt retained a Buy rating while reducing its price target to $800 from $900, and Baird raised its target to $630 with a Buy rating. In contrast, Summit Insights downgraded the shares from Buy to Hold, reflecting concerns about the stock’s already elevated expectations.
• Negative Sentiment: The stock fell sharply because the earnings beat and outlook did not clear the very high bar set by its roughly threefold recent advance and the broader AI-storage trade. Investors appear concerned about the pace of future growth and margins, with some reports noting that rival Seagate delivered an even stronger quarter. Storage peers, including SanDisk, also declined, reinforcing a broader technology-sector rotation. Reuters report on Western Digital and SanDisk

Institutional Trading of Western Digital

Several institutional investors have recently modified their holdings of the stock. Rakuten Securities Inc. boosted its holdings in Western Digital by 4,070.0% in the 2nd quarter. Rakuten Securities Inc. now owns 417 shares of the data storage provider’s stock worth $27,000 after buying an additional 407 shares during the last quarter. Avion Wealth raised its holdings in shares of Western Digital by 163.8% during the fourth quarter. Avion Wealth now owns 182 shares of the data storage provider’s stock valued at $31,000 after acquiring an additional 113 shares during the last quarter. Valley Wealth Managers Inc. acquired a new position in shares of Western Digital during the first quarter valued at approximately $32,000. Swiss RE Ltd. purchased a new position in shares of Western Digital in the fourth quarter valued at approximately $32,000. Finally, BOKF NA lifted its position in shares of Western Digital by 6,700.0% in the third quarter. BOKF NA now owns 272 shares of the data storage provider’s stock valued at $33,000 after acquiring an additional 268 shares in the last quarter. Institutional investors and hedge funds own 92.51% of the company’s stock.

Western Digital Price Performance

The stock has a market capitalization of $156.60 billion, a price-to-earnings ratio of 27.39 and a beta of 2.14. The stock has a 50 day moving average price of $569.14 and a 200-day moving average price of $415.61.

Western Digital (NASDAQ:WDC) last posted its quarterly earnings data on Tuesday, August 4th. The data storage provider reported $3.56 EPS for the quarter, beating the consensus estimate of $3.31 by $0.25. Western Digital had a return on equity of 42.95% and a net margin of 55.29%.The firm had revenue of $3.75 billion during the quarter, compared to the consensus estimate of $3.70 billion. During the same period in the prior year, the company earned $1.66 EPS. The firm’s revenue was up 43.8% compared to the same quarter last year. As a group, research analysts forecast that Western Digital Corporation will post 9.61 earnings per share for the current year.

Western Digital Dividend Announcement

The firm also recently declared a quarterly dividend, which will be paid on Thursday, September 17th. Stockholders of record on Tuesday, September 8th will be paid a $0.15 dividend. This represents a $0.60 annualized dividend and a dividend yield of 0.1%. The ex-dividend date of this dividend is Tuesday, September 8th. Western Digital’s dividend payout ratio (DPR) is currently 3.58%.

About Western Digital

Western Digital Corporation is a global data storage company that designs, manufactures and sells a broad range of storage devices and systems for personal, enterprise and cloud applications. Headquartered in San Jose, California, the company develops hard disk drives (HDDs), solid-state drives (SSDs), NAND flash components and finished storage products used in PCs, external storage, servers, network-attached storage (NAS) and embedded systems.

Its product portfolio spans consumer and commercial markets, including internal and external HDDs and SSDs, removable flash memory products and storage platforms for data center and enterprise environments.