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At Tuesday’s close, SanDisk stock settled at $2,273.73 per share, surging nearly 11% on the day and capping a staggering 858% year-to-date gain. Yet just in the preceding trading sessions, the Wall Street darling had experienced intraday sell-offs exceeding 6%. Over just three days, intense bulls-versus-bears positioning has vividly outlined the core tension in the AI memory sector: structural supply-demand gaps and a long-term agreement (LTA) moat are facing off against short-term bearish disruptions.
Friday’s Plunge: The Chain Reaction from OpenAI’s IPO Delay
On Friday, June 26, SanDisk shares tumbled more than 7% at one point. The immediate catalyst was news that OpenAI was leaning toward postponing its IPO to 2027. OpenAI had just completed a pre-IPO funding round at an $85.2 billion valuation, raising $12.2 billion in cash—funds expected to be deployed heavily into computing capacity rentals, ultimately translating into procurement demand for memory chips. A delayed IPO implies this windfall may arrive later than expected, triggering concerns over near-term memory demand pressure.
Monday’s Continued Drop: The Double Whammy of Local Substitution and Price Manipulation
On Monday, June 29, SanDisk opened with a plunge of more than 9%. Two bearish headlines converged that day: first, Apple was reported to be petitioning the U.S. government for permission to purchase chips from Chinese DRAM supplier CXMT as a replacement for Micron and SanDisk products; second, Samsung Electronics, SK Hynix, and Micron were hit with a class-action lawsuit alleging memory price manipulation and supply restrictions, raising concerns over the entire memory industry’s pricing mechanisms.
Tuesday’s Surge: Bernstein’s Doubled Price Target Reverses the Downtrend
In Tuesday’s trading, SanDisk surged nearly 11%, completely recouping the losses from the previous two sessions. The core catalyst came from a research note by top Wall Street investment bank Bernstein—analyst Mark Newman raised the firm’s price target on SanDisk from $1,700 to $3,000 per share, maintaining an “outperform” rating.
The rationale behind the upgrade lies in a new generation of long-term agreements (LTAs) that are reshaping the memory industry’s business model. Unlike traditional LTAs that were heavily skewed in favor of customers, the new-generation agreements introduce three key changes: fixed or banded pricing, no longer fully tracking spot market volatility; customers required to provide substantial upfront capital commitments or financial guarantees, making breach costs prohibitively high; and contract terms extended from 1-2 years to 3-5 years.
Bernstein’s stress test is highly compelling: assuming NAND prices crash 72% from peak levels, if 60% of SanDisk’s shipments are protected by LTAs, FY2030 EPS would still reach $214; without LTA protection, EPS would be only about $81 under the same scenario. This suggests that the “cyclical stock discount” the market has long assigned to memory companies is being broken.
Structural Logic Remains Intact
Short-term bearish factors—whether the timing mismatch in demand from OpenAI’s delayed IPO or the potential threat of Apple seeking local substitution—have not undermined the fundamental trend of AI-driven structural memory supply shortages. Micron has forecast memory supply deficits persisting through 2027-2028. With sustained strong demand and a highly concentrated supply landscape, SanDisk—bolstered by its LTA moat—is evolving from a “highly cyclical stock” toward a “growth stock with enhanced earnings predictability.”
