SanDisk’s shares jumped more than six‑fold in a year, but the company’s price‑to‑earnings multiple still lags the broader market.
Key points
- SanDisk’s share price rose over 600% in a year, outpacing the broader market.
- Earnings rebounded from a $1.64 billion loss to $11.4 billion profit, yet the stock trades at a P/E below the S&P 500 average.
- Operating margins surged to 78.5% and revenue grew 371.6% YoY, driven largely by data‑center demand and multiyear contracts.
- Future growth remains tied to NAND pricing, with contracts covering just over half of expected 2027 flash output.
Shares of SanDisk (SNDK) climbed 639.3% over the twelve months ending October 27, 2026, far outpacing the S&P 500’s 13.6% gain, according to Trefis. The rally followed the flash‑memory maker’s August 5, 2026, disclosure of multiyear supply contracts with eight data‑center and edge customers.
The stock surge coincided with a dramatic earnings swing: SanDisk generated $11.4 billion in earnings for the four quarters to July 3, 2026, after posting a $1.64 billion loss in the prior year. Even with that turnaround, the shares trade at a trailing P/E of 16.8, well below the S&P 500’s average multiple of 22.6.
Earnings rebound outpaces price gains
Operating profitability expanded sharply. The company’s operating margin rose from 8.3% in fiscal Q1 2026 to 78.5% in fiscal Q4 2026, while revenue jumped 371.6% year‑over‑year to $8.97 billion. Data‑center sales, the fastest‑growing segment, reached $5.15 billion—a 437% increase—and the newly signed contracts are expected to lock in at least $93.9 billion of revenue at floor prices over a weighted average term of more than four years.
Higher pricing, not just volume, drove roughly two‑thirds of the revenue growth between fiscal Q3 and Q4 2026, leaving SanDisk exposed to NAND price fluctuations despite the supply agreements. Management expects the contracts to cover more than half of flash output in fiscal 2027, with the remainder sold at market rates.
Margins expand as data‑center demand soars
The stock’s recent pullback—closing at $1,304.84 on October 27, down from a June 25 high of $2,335.00—reduced the trailing P/E to 29.2 in June, indicating that the lower multiple now reflects a price decline rather than higher earnings. Investors will watch the fiscal Q1 2027 results, due October 29, for clues on how much future growth stems from price versus volume.
Reader questions
What factors drove SanDisk’s share price increase?
According to Trefis, the rally was fueled by a swing from loss to profit, multiyear supply contracts with data‑center customers, and a sharp rise in operating margins and revenue.
How does SanDisk’s current P/E compare with the S&P 500?
SanDisk trades at a trailing P/E of 16.8, which is below the S&P 500’s average multiple of 22.6, despite its large share‑price gains.
Source: trefis.com
