Evercore ISI Group analyst Amit Daryanani initiated coverage on Western Digital Corp (NASDAQ:WDC) with an Outperform rating and a price target of $80.
The analyst found the company uniquely positioned to outperform, given a host of tailwinds that could drive a sizable upside to estimates (his estimates are ~10% higher vs. street).
While investors have been somewhat skeptical of the name, given it is “too complicated,” Daryanani expects the story to get “less complicated” over the next ~2-3 quarters as WDC splits into two distinct assets.
His analysis suggests that, on a sum-of-the-parts basis, the asset should be worth $80-85, though there could be some stranded costs that will diminish this number as details get flushed out.
Beyond that, WDC will see a confluence of cyclical HDD recovery as hyperscalers are done with nearline digestion, as per the analyst. WDC ...