SanDisk (SNDK) PT Lifted to $90 at Needham & Company

Needham & Company analyst Rajvindra Gill reiterated a Buy rating and boosted his price target on SanDisk (NASDAQ: SNDK) from $83 to $90 following strong Q1 on better than expected gross margins.

Gill comments, "We are reiterating our Buy and increasing our PT to $90 from $83 following better than expected gross margins. SNDK guided 2Q14 GMs of 47-49%, ~200bps above our est and raised its full year GMs to 47-49% vs prior guidance of 45-48%. Last quarter, we were concerned that gross margins had peaked and saw some risks that margins would decline due to weaker NAND pricing. However, going forward we are more confident that GMs will remain stable owing to favorable mix shift to enterprise SSDs, higher gross margins in the retail products, and lower price declines. Our new $90 PT implies 11x P/E CY15E, which is in line with its historical multiple, plus $18.70 net cash."

The firm raised FY 2014 EPS from $5.85 to $5.90 and set FY 2015 EPS at $6.50.

For an analyst ratings summary and ratings history on SanDisk click here. For more ratings news on SanDisk click here.

Shares of SanDisk closed at $75.85 yesterday.

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