Prediction: Sandisk Stock Is Going to $4,000 in 1 Year

Key Points

Sandisk's earnings are growing exponentially because of excessive demand for NAND flash storage and a supply shortage.

The company is building a solid revenue pipeline by entering into long-term supply agreements with customers.

The remarkable earnings spike anticipated for Sandisk and its attractive valuation are reasons the stock could triple in the coming year.

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Shares of Sandisk (NASDAQ: SNDK) have soared by 429% in 2026 already, fueled by the incredible demand for NAND flash storage chips from artificial intelligence (AI) data centers and edge devices capable of running AI workloads.

The high-flying tech stock got another shot in the arm following the release of fiscal 2026 third-quarter results (for the three months ended April 3) on April 30. Sandisk stock jumped 8% as it comfortably crushed Wall Street's expectations and delivered better-than-expected guidance.

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Even better, there is ample evidence suggesting that the red-hot growth that Sandisk has been enjoying isn't going to go away anytime soon. In fact, there is a good chance Sandisk stock will touch $4,000 in the next year, making it one of the top stocks to buy and hold right now. Let's see why that may be the case.

Sandisk's outstanding growth is poised to continue

Sandisk's fiscal Q3 revenue jumped by a whopping 3.5 times year over year to $5.95 billion, well above the $4.7 billion consensus estimate. The bottom-line growth was even more impressive. Sandisk reported adjusted earnings of $23.41 per share, a massive improvement over the prior-year period's loss per share of $0.30.

Analysts would have settled for $14.50 per share in earnings. It's worth noting that Sandisk had guided for $13 in earnings per share on revenue of $4.6 billion for the previous quarter. However, the need for more storage in AI data centers and the shift toward premium smartphones and personal computers with higher storage needs -- to help them run AI workloads locally -- has supercharged the demand for Sandisk's products.

Edge devices, which include smartphones and PCs, produced 62% of Sandisk's top line last quarter. The segment's revenue shot up 118% sequentially, and it is easy to see why. Market research firm TrendForce estimates that the average storage capacity in smartphones could increase by 4.8% this year, and that's despite the huge jump in NAND flash storage prices.

Premium smartphones are driving this growth. Apple, for instance, has doubled the minimum storage capacity in its latest iPhone 17 models to 256 gigabytes (GB). TrendForce notes that the 128 GB storage configuration in Android smartphones could vanish by the end of 2026 to support local AI processing. A similar scenario is unfolding in the PC market, as running AI models locally requires more data.

Counterpoint Research expects generative AI smartphone shipments to increase at an annual rate of 26% through 2030. Meanwhile, Fortune Business Insights expects the AI PC market to clock an annual growth rate of 20% through 2034. The secular growth of these end markets should ensure solid growth for Sandisk's edge devices segment in the long run.

On the other hand, data center customers are entering into long-term supply agreements with Sandisk. The company signed three long-term contracts last quarter, valued at $42 billion. Sandisk notes that these contracts carry different durations, with the longest one running for five years. Importantly, Sandisk has already signed two new long-term contracts in the current quarter, indicating that its revenue pipeline is getting stronger.

So it's easy to see why analysts have significantly enhanced their revenue growth expectations from Sandisk.

Another important point worth noting is that there isn't enough supply available to meet the flash storage demand in smartphones, PCs, and data centers. This shortage is why the price of NAND flash memory is projected to jump by a whopping 234% in 2026, according to Gartner. This trend of higher prices isn't going away anytime soon, as NAND flash is expected to remain in short supply until 2028.

In all, the favorable demand-supply dynamics will ensure that Sandisk's phenomenal earnings growth continues in the next fiscal year as well, paving the way for the stock to soar higher.

Why the stock may be headed to $4,000

Sandisk has guided for $8 billion in revenue and $31.00 in earnings per share for the current quarter, obliterating the consensus estimate of $6.49 billion in revenue and $22.70 per share in earnings. The guidance points toward exponential growth over the year-ago period's revenue of $1.90 billion and adjusted earnings of $0.29 per share.

The upbeat guidance explains why analysts have substantially raised their earnings expectations for Sandisk.

Sandisk can crush those expectations, as it has already delivered $30.82 in adjusted earnings per share in the nine months of the current fiscal year, and it expects to clock $31 per share in the current quarter alone.

Assuming Sandisk's earnings are in line with the market's expectations of $168 per share in the next fiscal year (which will end in June 2027), and it trades at 22 times earnings at that time, in line with the S&P 500 index's forward earnings multiple, its stock price could reach almost $4,000.

That would be a 3x jump from $1,406 on May 5. Given that Sandisk is trading at just 23 times forward earnings right now, investors are getting a great deal on this AI stock, especially considering that it could deliver bigger gains than discussed above if the market decides to reward it with a premium valuation.

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Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple. The Motley Fool recommends Gartner. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.