Western Digital (WDC) Stock Reaches All-Time High with Insiders Selling

TLDR

• WDC reached a record high of $366.30, achieving a 929% return over one year.
• The company’s market capitalization is currently $123.75 billion.
• Q4 EPS was $2.13, surpassing the $1.93 estimate; revenue increased 25.2% year-over-year to $3.02B.
• S&P Global elevated WDC to ‘BBB-‘ after actions to reduce debt.
• Company insiders sold approximately 92,795 shares valued at $24.3M in the past 90 days.

(SeaPRwire) –   Western Digital reached a record high of $366.30 on Thursday, concluding a 929% surge over the previous 12 months.

Western Digital Corporation, WDC

The stock began trading at $365.00 and has a market capitalization of $123.75 billion. Its 50-day moving average is $289.34, and its 200-day moving average is $213.17 — both significantly lower than the current trading price.

The 52-week range illustrates the dramatic shift: WDC climbed from a low of $35.00 to Thursday’s peak. This is correct.

Strong Earnings Fueling the Move

Western Digital reported fourth-quarter earnings of $2.13 per share, exceeding the consensus estimate of $1.93 by $0.20. Revenue was $3.02 billion, beating the $2.93 billion forecast and representing a 25.2% increase from the prior year’s quarter.

The return on equity stood at 41.53%, with a net margin of 35.52%. Analyst projections now indicate full-year EPS of $4.89.

A quarterly dividend of $0.125 per share was also declared, payable on March 18th. This results in an annualized dividend of $0.50 and a yield of 0.1%.

S&P Global Ratings raised WDC to ‘BBB-‘ subsequent to the company redeeming all outstanding 4.750% senior notes due in 2026. The rating action acknowledges Western Digital’s strategy to lower debt, which also involved exchanging Sandisk stock for liabilities.

According to a recent regulatory filing, Western Digital also intends to sell up to 7.5 million Sandisk shares. The proceeds will not go to Sandisk, as Western Digital holds these shares directly.

Institutional Buying Picks Up

Institutional investors hold 92.51% of WDC. KBC Group NV increased its stake by 166.7% in the fourth quarter, acquiring 373,199 additional shares for a total holding of 597,009, valued at approximately $102.85 million.

Vanguard Group possesses 43.28 million shares. WCM Investment Management established a new position valued at $791.3 million. Both Northern Trust and Dimensional Fund Advisors increased their holdings by more than 11% in the third quarter.

Fred Alger Management executed the most substantial move, expanding its position by 4,923.9% in Q3 through the addition of over 3.3 million shares.

Bernstein SocGen Group upgraded WDC to Outperform, describing the recent decline in hard disk drive and memory stocks as a chance to buy.

Analyst sentiment is predominantly positive: 21 analysts recommend a Buy, while three maintain a Hold rating. The average price target is $288.33, which is now considerably below the current stock price.

Citigroup holds the most optimistic target at $405.00, issued on Monday alongside a Buy rating. Cantor Fitzgerald has an Overweight rating with a $325.00 target.

The situation with insiders is less uniform. Insiders disposed of 92,795 shares valued at $24.3 million during the last 90 days. Insider Cynthia L. Tregillis sold 9,324 shares on March 4th at $268.27. Director Matthew E. Massengill sold 36,926 shares on February 5th at $260.43.

Insiders now hold only 0.18% of the company.

InvestingPro data indicates the stock is trading above its Fair Value, although revenue growth of 28% over the past twelve months provides support for the optimistic outlook.