Western Digital Corporation Common Stock (WDC) fair value
Technology · Computer Hardware · NASDAQ · United States
$343.67-2.97%
Market cap $128.6BNext earnings 2026-10-22Updated Oct 23, 2026
Our verdict
Trades 227% above our fair value
Price
$343.67
Model fair valueConfidence: medium
$105
Only one of our models could value this stock with confidence, so use it as a guide.
Not used by alerts or posts.
Valued as a cyclical company: P/E comparison, EV/EBITDA comparison, Discounted cash flow, and Graham number.
ACCE opinionWestern Digital Corporation Common Stock (WDC)
Fair value (2 models)
Not available
ACCE price target
$405
Rating
Not rated
Horizon
12 months
ACCE price target published on 23 Oct 2026, 01:53 CEST; previously $477 since 17 Sept 2026, 00:00 CEST.
Price used: $344 at the close on 23 Oct 2026, 22:00 CEST.
Models: P/E comparison and EV/EBITDA comparison.
Fair value: the average of the applicable valuation models (discounted cash flow, multiples, residual income, dividend discount, shareholder yield), each run on the latest financial statements and the market price shown. Opinion columns (fair value, target, rating) are shown apart from the data. Full methodology: acceinvestments.com/data/how-we-value-stocks
Conflicts of interest: The author holds no personal position in this security. General statement
Produced by ACCE Investments (acceinvestments.com)
Data
ACCE score
73
out of 100
Analysts
81% buy
26 covering
P/E
12.8x
forward 8.7x
1-year return
+173.4%
Dividend yield
0.17%
Western Digital Corporation Common Stock in four questions
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Overview
ACCE thesis
Western Digital manufactures NAND flash memory and hard disk drives for data centers, PCs, and consumer devices, with significant exposure to enterprise storage and AI infrastructure. The company benefits from structural tailwinds in AI adoption and data center expansion, where storage capacity requirements are growing faster than compute, creating durable demand for both flash and HDD solutions. Near-term upside hinges on AI server deployments driving incremental NAND demand and potential gross margin expansion as manufacturing utilization normalizes post-cycle. Revenue growth of 43.8% reflects recovery from the 2022-2023 downturn, but the forward PE of 22.8x against an operating margin of 43.6% suggests the market is pricing in sustained strength rather than a temporary rebound. At current valuations, the risk-reward depends on whether data center storage intensity continues to accelerate or reverts to historical growth rates.
⚠ Investor warnings · 3 flagsAI-assisted·How I use AI
high
Valuation disconnect
Forward P/E of 22.8 vs trailing 14.8 implies earnings expected to fall ~35%. Current price $397.28 sits below fair value midpoint $477, but forward multiple suggests market is pricing in material deceleration.
moderate
Long-term revenue decline
5-year revenue CAGR is -5.3%, indicating structural headwinds despite recent +43.8% YoY bounce. Sustainability of current growth trajectory unclear.
moderate
Insider selling pressure
Last 10 disclosed transactions show $10.04M in sales vs $0 in buys. No offsetting insider conviction despite strong recent performance.
AI research notes
AI-assisted·How I use AIWritten Oct 11, 2026 · figures from 2026-06-30 · prices to Oct 23, 2026
Why it could do well
Revenue surged 43.8% year over year, driven by AI datacenter demand that shows no near-term signs of abating.
Net margin of 73.0% and ROE of 130.8% demonstrate exceptional profitability and capital efficiency at scale.
Why it could disappoint
Five-year revenue growth averaged minus 5.3% annually, showing the current 43.8% spike is cyclical, not structural.
Diluted share count grew 6.7% last fiscal year while free cash flow yield sits at only 2.4%, limiting shareholder returns.
The 22.8x forward multiple implies 10.8% perpetual cash flow growth, which is unsustainable given historical mean reversion in memory chip cycles.
Each chip shows the exact figure and where it comes from. A claim without a source is not published.
Walk me through this stock
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Valuation
INVESTOR
Where WDC's valuation models land
Price
$343.67
Model fair valueConfidence: medium
$105
Model
Fair value
Upside
Discounted cash flow
EV/EBITDA comparison
Graham number
P/E comparison
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Quality
INVESTOR
Quality and conviction INVESTOR FEATURE
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