Western Digital Corporation Will Hit $600 on This Date

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Western Digital (NASDAQ:WDC) has become the AI storage trade nobody saw coming a year ago. The pure-play HDD maker, post-Sandisk spinoff, just delivered a quarter where gross margin crossed 50% for the first time and revenue jumped 45.47% year over year.

CEO Irving Tan put it bluntly on the Q3 FY26 call: “Virtually every AI workload, from training, inference, agentic AI to physical AI, creates data that is stored persistently and cost-efficiently on HDDs.”

Shares are up 227.02% YTD. The question I want to answer: can WDC actually punch through $600?

What’s Holding Western Digital Back Right Now

“Stuck” is generous. Shares ran 10.01% in the past week and 13.97% in the past month. The real friction is valuation gravity at these levels. After a 911.87% one-year move, every uptick invites profit-taking. With beta of 2.2, this name swings hard in both directions.

Morningstar has flagged that “most of these stocks are currently overvalued and lack durable competitive advantages,” and insider activity has skewed toward selling on 155 recent transactions. Shares also sit 9% below the 52-week high of $602.38, where shares ran into a wall the first time. Until WDC reprints that level and holds it, the stock is digesting, not breaking out.

Wall Street Sees Modest Upside. Our Model Sees Less

Wall Street consensus is $547.09, which actually sits below today’s price. The rating split: 4 Strong Buy, 17 Buy, 3 Hold, 0 Sell, and 1 Strong Sell. That’s an 84% bullish consensus, but on price they’ve been chasing the chart.

Our base case lands at $544.99 with 90% confidence, a modest -3.2% from here, with an optimistic case of $643.80 and a bear case of $396.65. My honest read: analysts are anchored to stale targets and will be dragged higher only after the Q4 earnings report. The earnings power is moving faster than their models.

The Path to $600 Per Share

Reaching $600 from today’s price of $562.92 would require a gain of 6.6%. That’s one good earnings reaction away.

With forward EPS of $12.43, a price of $600 implies a forward P/E of 48x. Our base case of $544.99 already implies 68x on a different EPS basis, so the multiple expansion math actually works in reverse here: $600 looks reasonable against forward earnings power if Q4 FY26 guidance of $3.25 EPS hits.

The catalysts are stacking. WDC has tripled in 2026 on the AI storage cycle, CFO Kris Sennesael cited the ability to meet exabyte demand through higher-capacity drives rather than new factories, and the 40-terabyte drive ramp is the next leg. Institutional ownership of 92.51% tells me the smart money is parked. The risk: any hyperscaler capex pause would slam this multiple fast.

Where Western Digital Trades Today vs Its Earnings Power

At $562.92 against forward EPS of $12.43, WDC trades at a forward P/E of 45x. That looks rich until you remember Q3 FY26 net income grew 511.64% year over year and FCF rose 158.05%.

Shares sit between a 52-week low of $56.12 and a high of $602.38, and the 10-year return stands at 1,745.72%. Earnings power is finally catching up to the multiple, which is exactly what a $600 print needs.

Is $600 Realistic? Here’s My Take

$600 from $562.92 requires 6.6%. With Q4 FY26 guiding revenue of $3.65 billion and EPS of $3.25, this is realistic and well within reach.

Three things need to go right: Q4 delivers another beat, the 40TB drive ramp lands on schedule, and hyperscaler capex commentary stays constructive into fall. What derails it? Any meaningful pricing reset in HDDs. Returns at this level shouldn’t be expected every year, but we’ve outlined the blueprint for how Western Digital could reach $600 in 2026.

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