Western Digital (NASDAQ:WDC) Stock Falls 6.9% – What’s Next?

Western Digital Corporation (NASDAQ:WDC) fell 6.9% on Tuesday. The stock traded as low as $406.81 and last traded at $411.04. Approximately 13,345,011 shares were traded during trading, an increase of 54% from the average daily volume of 8,649,804 shares. The stock had previously closed at $441.64.

Western Digital News Roundup

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

• Positive Sentiment: Analysts continue to see long-term upside for Western Digital, arguing that AI data-center expansion is driving strong demand for high-capacity HDDs and that the market remains undersupplied. Some research notes have characterized the recent Toshiba-related selloff as an opportunity to “buy the dip.” Western Digital and Seagate Stock Jump as Analysts Say Buy the Dip
• Positive Sentiment: Western Digital’s latest reported quarter exceeded analyst expectations, with revenue up sharply year over year and earnings above consensus. The company also issued earnings guidance that supports the ongoing AI-storage growth narrative.
• Neutral Sentiment: The HDD industry is entering a more competitive phase as Western Digital, Seagate and Toshiba pursue AI-related storage demand through capacity expansion, technology upgrades and supply-chain control. Seagate vs. Western Digital vs. Toshiba: The AI Storage War Is Getting Serious
• Negative Sentiment: Reports that Seagate and Toshiba are competing to acquire TDK’s hard-drive magnetic-heads unit raised concerns about greater vertical integration and additional competitive pressure. TDK is described as the only independent manufacturer of magnetic-recording heads, making the potential transaction strategically significant. Seagate, Western Digital stocks are falling again on Tuesday
• Negative Sentiment: Toshiba’s plan to substantially increase HDD production has revived fears of future oversupply, lower pricing power and market-share pressure for Western Digital. The stock’s decline followed a rebound the previous session, highlighting continued volatility as investors weigh AI demand against expanding supply. Seagate, Western Digital stocks slip as Toshiba’s AI storage push rattles sector

Analysts Set New Price Targets

WDC has been the subject of several recent analyst reports. Summit Insights cut shares of Western Digital from a “buy” rating to a “hold” rating in a research note on Thursday, August 6th. Rosenblatt Securities cut their price target on shares of Western Digital from $900.00 to $800.00 and set a “buy” rating for the company in a report on Thursday, August 6th. UBS Group cut their price target on shares of Western Digital from $560.00 to $525.00 and set a “neutral” rating for the company in a report on Thursday, August 6th. Cantor Fitzgerald lifted their price objective on Western Digital from $660.00 to $900.00 and gave the company an “overweight” rating in a report on Monday, June 29th. Finally, Wells Fargo & Company boosted their target price on Western Digital from $575.00 to $730.00 and gave the stock an “overweight” rating in a research report on Friday, July 10th. Two research analysts have rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating and five have issued a Hold rating to the stock. According to MarketBeat.com, the company has a consensus rating of “Moderate Buy” and a consensus price target of $534.56.

Western Digital Trading Down 6.9%

The firm has a market capitalization of $141.68 billion, a price-to-earnings ratio of 16.98, a PEG ratio of 1.76 and a beta of 2.11. The stock’s 50 day moving average price is $463.99 and its two-hundred day moving average price is $472.64.

Western Digital (NASDAQ:WDC) last announced its quarterly earnings data on Wednesday, August 5th. The data storage provider reported $3.56 EPS for the quarter, beating the consensus estimate of $3.31 by $0.25. The firm had revenue of $3.75 billion during the quarter, compared to analysts’ expectations of $3.70 billion. Western Digital had a net margin of 72.95% and a return on equity of 48.15%. The business’s revenue for the quarter was up 43.8% compared to the same quarter last year. During the same quarter last year, the business earned $1.66 earnings per share. Western Digital has set its Q1 2027 guidance at 3.850-4.150 EPS. On average, sell-side analysts forecast that Western Digital Corporation will post 19.65 earnings per share for the current fiscal year.

Western Digital Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Thursday, September 17th. Stockholders of record on Tuesday, September 8th were given a dividend of $0.15 per share. This represents a $0.60 dividend on an annualized basis and a dividend yield of 0.1%. The ex-dividend date was Tuesday, September 8th. Western Digital’s dividend payout ratio (DPR) is presently 2.48%.

Insider Transactions at Western Digital

In related news, insider Cynthia L. Tregillis sold 432 shares of Western Digital stock in a transaction on Friday, September 4th. The stock was sold at an average price of $451.20, for a total transaction of $194,918.40. Following the completion of the transaction, the insider directly owned 111,030 shares of the company’s stock, valued at approximately $50,096,736. The trade was a 0.39% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Irving Tan sold 20,000 shares of the company’s stock in a transaction on Tuesday, August 11th. The shares were sold at an average price of $444.97, for a total value of $8,899,400.00. Following the completion of the sale, the chief executive officer directly owned 575,966 shares in the company, valued at $256,287,591.02. This trade represents a 3.36% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 25,437 shares of company stock valued at $11,461,345 in the last quarter. 0.18% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently made changes to their positions in the company. Handelsbanken Fonder AB increased its position in Western Digital by 71.4% during the second quarter. Handelsbanken Fonder AB now owns 230,578 shares of the data storage provider’s stock worth $147,275,000 after purchasing an additional 96,078 shares during the last quarter. OMERS ADMINISTRATION Corp acquired a new position in shares of Western Digital in the 2nd quarter valued at $19,694,000. NewEdge Wealth LLC purchased a new stake in shares of Western Digital during the 2nd quarter valued at $14,466,000. OneAscent Financial Services LLC purchased a new stake in shares of Western Digital during the 2nd quarter valued at $1,599,000. Finally, Focus Partners Advisor Solutions LLC acquired a new stake in shares of Western Digital during the 2nd quarter worth $8,307,000. Institutional investors and hedge funds own 92.51% of the company’s stock.

Western Digital Company Profile

Western Digital Corporation (NASDAQ: WDC) develops, manufactures and supplies data-storage products and solutions. The company’s portfolio is centered on hard disk drives (HDDs) used in cloud and enterprise data centers, personal computers, network-attached storage systems and other applications that require high-capacity data storage.

Western Digital markets products under brands including Western Digital, WD and Ultrastar. Its offerings include enterprise and data-center HDDs, storage products for business and consumer systems, and related technologies designed to help organizations store, manage and access large volumes of data.

Founded in 1970, Western Digital has evolved from a maker of electronic components into a global data-storage company.