Western Digital (NASDAQ:WDC) Shares Down 6.9% – Here’s Why

Western Digital Corporation (NASDAQ:WDC) dropped 6.9% during mid-day trading on Friday. The stock traded as low as $331.81 and last traded at $332.00. Approximately 7,937,417 shares traded hands during mid-day trading, a decline of 8% from the average daily volume of 8,649,698 shares. The stock had previously closed at $356.45.

Key Headlines Impacting Western Digital

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

• Positive Sentiment: Wells Fargo analysts said the recent selloff in Western Digital and Seagate has been “well overdone” and remained broadly bullish, providing some support for the long-term outlook. Seagate and Western Digital Stocks Fall on Toshiba Fears
• Positive Sentiment: Western Digital expects fiscal first-quarter revenue to increase about 45%, driven by strong AI infrastructure and cloud-storage demand. Its prior quarter exceeded analyst expectations for both revenue and earnings, while management’s fiscal 2027 EPS guidance remains solid. Western Digital Pre-Q1 Earnings
• Neutral Sentiment: Investors are waiting for the October 22 earnings report to determine whether accelerating AI and hyperscaler demand can support current earnings estimates and justify the stock’s valuation. Western Digital Earnings Preview
• Negative Sentiment: Wells Fargo reduced its price target for Western Digital, adding to bearish headlines even though the firm reportedly maintained a constructive view. The cuts have intensified concerns that expectations for the AI trade had become excessive. Friday’s First Moves
• Negative Sentiment: Investors are concerned that Toshiba’s planned hard-disk-drive capacity expansion could increase future supply and pricing pressure. Rising interest-rate risks and questions about whether roughly $1 trillion of hyperscaler capital spending can continue are also weighing on storage stocks. Seagate and Western Digital Face Supply Risks
• Negative Sentiment: A broader technology and memory-stock selloff, concerns about Chinese competition in server memory, and analyst commentary describing Western Digital as potentially near a cyclical peak have prompted investors to lock in gains after its substantial advance. Memory Stocks Extend Selloff on China Competition Fears

Analyst Ratings Changes

Several research firms recently commented on WDC. Summit Insights downgraded shares of Western Digital from a “buy” rating to a “hold” rating in a report on Thursday, August 6th. The Goldman Sachs Group reduced their price objective on shares of Western Digital from $650.00 to $615.00 in a research note on Thursday, August 6th. Mizuho set a $590.00 target price on shares of Western Digital in a report on Thursday, August 6th. 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 report on Wednesday, July 8th. Finally, Cantor Fitzgerald increased their target price on Western Digital from $660.00 to $900.00 in a research report on Thursday, August 6th. One analyst has rated the stock with a Strong Buy rating, twenty have issued a Buy rating and seven have given a Hold rating to the stock. According to data from MarketBeat.com, Western Digital currently has an average rating of “Moderate Buy” and an average price target of $608.26.

Western Digital Trading Down 6.9%

The company’s fifty day simple moving average is $442.85 and its 200 day simple moving average is $476.83. The stock has a market capitalization of $124.27 billion, a P/E ratio of 13.71, a P/E/G ratio of 1.41 and a beta of 2.11.

Western Digital (NASDAQ:WDC) last released its quarterly earnings results on Wednesday, August 5th. The data storage provider reported $3.56 earnings per share for the quarter, topping the consensus estimate of $3.31 by $0.25. Western Digital had a net margin of 72.95% and a return on equity of 48.15%. The firm had revenue of $3.75 billion for the quarter, compared to analysts’ expectations of $3.70 billion. During the same quarter in the prior year, the firm posted $1.66 earnings per share. The business’s quarterly revenue was up 43.8% on a year-over-year basis. Western Digital has set its Q1 2027 guidance at 3.850-4.150 EPS. Equities research analysts predict that Western Digital Corporation will post 19.65 earnings per share for the current year.

Western Digital Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Thursday, September 17th. Investors of record on Tuesday, September 8th were given a dividend of $0.15 per share. This represents a $0.60 annualized dividend and a yield of 0.2%. The ex-dividend date was Tuesday, September 8th. Western Digital’s payout ratio is presently 2.48%.

Insiders Place Their Bets

In other news, insider Cynthia L. Tregillis sold 1,007 shares of Western Digital stock in a transaction dated Thursday, August 27th. The stock was sold at an average price of $478.36, for a total transaction of $481,708.52. Following the completion of the sale, the insider owned 112,155 shares in the company, valued at approximately $53,650,465.80. This trade represents a 0.89% decrease in their position. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Vidyadhara K. Gubbi sold 1,795 shares of Western Digital stock in a transaction dated Friday, September 4th. The shares were sold at an average price of $459.87, for a total value of $825,466.65. Following the sale, the insider owned 80,571 shares of the company’s stock, valued at approximately $37,052,185.77. This trade represents a 2.18% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold 25,437 shares of company stock worth $11,461,345 in the last ninety days. 0.20% of the stock is currently owned by insiders.

Institutional Inflows and Outflows

Several institutional investors have recently modified their holdings of the stock. Legal & General Group Plc bought a new stake in Western Digital during the second quarter valued at approximately $1,602,927,000. Anther Capital Ltd purchased a new position in Western Digital in the 2nd quarter worth approximately $901,601,000. Deutsche Bank AG bought a new position in shares of Western Digital in the 2nd quarter worth $885,565,000. Value Aligned Research Advisors LLC bought a new position in shares of Western Digital in the 1st quarter worth $350,403,000. Finally, Trivest Advisors Ltd bought a new position in shares of Western Digital in the 2nd quarter worth $627,606,000. 92.51% of the stock is currently owned by institutional investors.

Western Digital Company Profile

Western Digital Corporation (NASDAQ: WDC) is a data storage technology company that develops and manufactures hard disk drives (HDDs) and related storage solutions. Its products are used in data centers, cloud infrastructure, enterprise systems, personal computers, gaming platforms and external storage devices.

The company offers HDD-based products for business and consumer applications, including high-capacity drives designed for hyperscale and cloud data centers, enterprise storage environments, network-attached storage systems and personal computing.