Arete starts SanDisk with Buy on ‘steep’ valuation discount

Arete initiated coverage of SanDisk (SNDK) with a Buy rating and $63 price target The shares trade at a “steep discount” to their historical valuation multiples, likely reflecting SanDisk’s weaker market position today, the analyst tells investors in a research note. However, the firm expects gradual improvement starting this quarter driven by NAND supply adjustments, barring a global recession. Given the industry’s focus shift from market share to profitability, the company’s near- to mid-term consolidation risk is diminishing, which should be positive for the shares, contends Arete.