Halyk Finance: Sandisk trading idea

SanDisk – a leading developer, manufacturer, and supplier of data storage devices and solutions based on NAND flash memory technology. Thanks to its unique innovative mechanism that drives the development of data storage and semiconductor technologies, the company's portfolio offers powerful flash memory storage solutions for everyone – from students, gamers, and home offices to the largest enterprises and public cloud services – enabling users to collect, store, access, and transform an ever-growing variety of data. The company's products include a wide range of solid-state drives, embedded products, removable cards, USB-based drives, as well as silicon wafers and components.

Growth drivers:

• Long-term contracted revenue – SanDisk has signed 5 agreements under NBM (3 in Q3 and 2 in Q4), including several U.S. hyperscalers – the customer base is expanding rather than concentrating on a single name. The total contracted value increased from $42 billion to $93.9 billion for the quarter, guarantees – from $11 billion to $16.5 billion, and contracts include prepayments with stricter price fixing in the coming years.
• Growth in data center segment prices – segment revenue in Q3'26 reached $2.98 billion, and its share in shipments increased from 12% to 38%. Two-thirds of the growth in price power was driven by demand for memory for inference workloads.
• Industry supply deficit – memory supply growth in FY2027 is planned at the lower end (14–15%): the company is deliberately withholding volumes and accumulating inventories to ensure reliable supplies to major customers.
• High Bandwidth Flash in partnership with SK Hynix – SanDisk and SK hynix are publicly promoting a new class of memory, which is high-bandwidth NAND designed to be placed close to the processor for AI inference tasks. The capacity of such a module reaches 512 GB, and the bandwidth is up to 3 TB/s.
• Forward-looking forecast revision – memory manufacturers are trading at low P/E ratios (4–6x vs. 20x for the IT sector). If long-term contracts confirm the cycle's resilience, the sector and SanDisk will gain additional growth through upward revaluation of multiples, not just through profits.
• Sustainable market position – according to Counterpoint Research, global NAND industry revenue reached a record $46 billion in Q1 2026, with SanDisk holding a market share of about 13% — on par with Micron and China's YMTC.
• Diversification of the memory supply chain – in March 2026, SanDisk invested $1 billion in Nanya Technology (DRAM) to secure access to in-demand DRAM and reduce dependence on the NAND market alone.
• Accelerated capital return to shareholders – the share buyback program has been increased to $20 billion through a new tranche of $14 billion. Of this amount, $4.5 billion has already been repurchased, with further acceleration in buyback pace expected in the coming quarters.