Is Sandisk the Next Nvidia?

One twelvemonth ago, Sandisk (NASDAQ: SNDK) was spun disconnected from Western Digital (which had bought it successful 2016) and erstwhile again became an independent, publically traded company. Since making its 2nd debut connected the Nasdaq, Sandisk banal has skyrocketed by much than 1,500%.

Let's dive into the tailwinds that person fueled Sandisk's parabolic terms enactment and see whether it's inactive a bully clip for astute investors to bargain the stock.

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Before examining Sandisk's ascent, investors whitethorn find it adjuvant to recognize however Nvidia (NASDAQ: NVDA) became the person of the AI processor realm. While Nvidia is simply a diversified business, its breadstuff and food is designing graphics processing units (GPUs) -- the hardware that provides the cardinal computing powerfulness required to make and deploy AI models.

Over the past fewer years, hyperscalers similar Meta Platforms, Alphabet, Microsoft, Amazon, and OpenAI person collectively spent hundreds of billions of dollars procuring GPUs from Nvidia. As companies accelerate the gait astatine which they put successful AI, the information workloads progressive are scaling astatine an unprecedented rate.

This is starring to capableness constraints -- and arsenic request for further unreality infrastructure is connected the rise, request for GPUs and different AI processors is outpacing supply. But arsenic the information halfway buildout continues, different large bottleneck is forming successful the high-bandwidth representation (HBM) market.

Big tech is nary longer solely focused connected securing arsenic galore GPUs arsenic possible. Increasing shares of infrastructure budgets are present flowing toward different pouch of the AI spot worth chain: dynamic random entree representation (DRAM) and NAND solutions. This is wherever Sandisk enters the picture.

Next-generation products successful agentic AI, autonomous systems, and robotics are acold much analyzable than chatbots. These systems indispensable process monolithic volumes of data, which means they request accelerated entree to that information from retention successful adjacent proximity to the processors. So arsenic AI workloads expand, servers with much robust representation and retention solutions are becoming mission-critical necessities. For this reason, superior expenditures are swiftly rotating toward coagulated authorities drives, DRAM, and NAND flash retention -- precisely what Sandisk offers.

As of this penning (Feb. 11), Sandisk banal is hovering close astir $600 per share. Given the terms tag, you mightiness deliberation you've missed retired connected the accidental to put successful it profitably. However, stock terms unsocial doesn't uncover overmuch astir a company's underlying valuation.