SanDisk Surges 9% as Memory Sector Stages Comeback Rally

Quick overview

Shares of SanDisk Corp (NASDAQ: SNDK) rose more than 9% on Tuesday, ending at $692.73 as the memory industry saw a widespread rebound after a bullish analyst note eased market anxiety following a recent technical concern.

The rise followed Cantor Fitzgerald’s reaffirmation of its buy rating on memory chip giant Micron (NASDAQ: MU), designating it as a top pick with a $700 price target. Micron increased by about 9% during the session, bringing SanDisk and the larger memory complex along with it.

A Sector Recovering From a Shock

Alphabet’s announcement of its TurboQuant algorithm, a compression technology that the company claims may drastically cut data storage requirements, caused a major selloff in memory stocks, which served as the backdrop for Tuesday’s advances. Investors were alarmed by the statement because they thought it may reduce demand for flash memory and DRAM chips, which are essential to businesses like SanDisk and Micron.

Cantor Fitzgerald refuted the story, claiming that any demand destruction caused by the new algorithm would probably be offset by Jevons’ paradox. The economic principle asserts that increased resource efficiency typically results in higher overall consumption rather than lower use; this dynamic has repeatedly occurred throughout the history of computing. If the theory is correct, faster data production and AI workloads could result from more effective storage compression, which would ultimately increase demand for the very CPUs that investors were concerned TurboQuant would render obsolete.

SanDisk Rides a Powerful Tailwind

The increases on Tuesday coincide with SanDisk’s rise to prominence in the market over the previous 12 months. Due to rising AI infrastructure spending and a tightening memory supply situation, shares have increased by around 1,226% over the last 12 months and more than 150% so far this year.

This momentum is demonstrated by the company’s most recent financial results. In the second fiscal quarter of 2026, revenue reached $3.025 billion, exceeding analyst projections by more than 12% and representing a 61% year-over-year increase. Free cash flow hit $980 million, a sharp increase from negative territory just three quarters prior, and its datacenter division increased 76% during that time. Management has projected $4.4 to $4.8 billion in revenue for the third quarter, with gross margins expected to reach 65–67%.

Strategic Moves and Investor Debate

Not all of the recent headlines have been positive. SanDisk announced a $1 billion equity investment in Taiwanese memory chip producer Nanya Technology just last week, which caused the stock to drop almost 6% on the day of the announcement. Bulls viewed the transaction as a solid supply-chain strategy, but bears questioned the capital deployment given geopolitical risks and a long return period. The deal is intended to lock in long-term supply access in a tight market.

With $1.54 billion in cash reserves and the company now net-cash positive ahead of schedule, management presented the decision as a planned allocation rather than a stretch. The company is rated as a Buy or Strong Buy by 14 out of 20 covering analysts, with an average price target of about $770, suggesting additional upside from current levels.

Does SanDisk (SNDK) Stock Still Have Room to Run?

However, valuation is a contentious issue. SanDisk’s intrinsic value is estimated by a discounted cash flow analysis from Simply Wall St. to be close to $1,995 per share, indicating that the company may be significantly undervalued in comparison to long-term cash flow estimates. The stock’s price-to-sales ratio is 11.45x, which is marginally higher than the company’s stated “fair ratio” of 10.84x.

It is evident that SanDisk continues to be one of the technology industry’s most sentiment-sensitive brands. SNDK soars when memory is on its side. Fear falls quickly when it arises, whether from geopolitical headlines or compression algorithms. The selloff that precedes the rise and the speed at which confidence may rebound were both displayed on Tuesday.

ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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