Investing.com -- Barclays analyst Tom O'Malley upgraded Sandisk to Overweight in a note on Wednesday, lifting the stock’s price target to $2,300, arguing that the memory and storage sector is entering a fundamentally different phase driven by long-term contracts, tighter supply, and unprecedented pricing visibility.

In the note, Barclays calls Memory and Storage “the most attractive vertical below accelerators,” highlighting that the current supply-demand imbalance is likely to persist through CY27.

According to the firm, new long-term agreements (LTAs) and multi-year supply deals, complete with “embedded financial mechanisms, price floors, and in some cases prepayments,” mark a major inflection point for the industry.

Barclays argues that for companies like Seagate Technology and Western Digital, LTAs tied to nearline HDD demand finally offer the visibility that “was difficult to obtain in the spot-driven markets of prior cycles.”

In NAND, SNDK “has capitalized on the current state of the market,” rolling out new business models with clear RPO and financial guarantees, which Barclays says could serve as a template for peers.

The firm also points to developments at Micron Technology, which recently announced a five-year strategic customer agreement with pricing and guarantee “hooks” that move the sector toward something resembling a recurring-revenue profile.

Barclays sees Sandisk as one of the biggest beneficiaries of this shift. With NAND contract floor pricing locked in at Q1 levels, the bank forecasts a gross-margin profile in the high-70% range and an implied CY28 EPS of roughly $165.

That serves as a “proxy floor,” the firm writes, arguing that increased visibility and structurally higher pricing create a compelling setup for another leg higher in the memory trade.