WDC - Why Western Digital Stock Surged Today
Shares of Western Digital (NASDAQ: WDC) jumped 14.5% on Tuesday after Elliott Investment Management sent a letter to the tech giant's board of directors urging it to conduct a strategic review of its operations.
Western Digital operates two largely distinct businesses. One is focused on hard disk drives that are often found in desktop computers and data centers, while the other makes NAND flash memory that's increasingly used in mobile devices.
Elliott believes that Western Digital would be better served by spinning off its flash business into a separate enterprise. The investment firm argued that Western Digital's operational and financial underperformance relative to its competitors has largely been due to its futile attempt to operate these two disparate businesses within a single corporation.
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Why Western Digital Stock Surged Today