Western Digital (WDC), a provider of data storage solutions like hard-disk drives (HDDs) and solid-state drives (SSDs), is set to announce its results for the third quarter of Fiscal 2026 on April 30. WDC stock has rallied 137% year-to-date and 900% over the past year (as of writing), driven by strong demand for storage solutions in artificial intelligence (AI) data centers. Ahead of Q3 earnings, top analysts at Bank of America and Wedbush raised their price targets for Western Digital stock, reiterating their bullish stance.
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STXX: an alternative to margin or options on STXWall Street expects WDC to report EPS (earnings per share) of $2.40 for Q3 FY26, reflecting 76.5% year-over-year growth. Revenue is projected to rise by about 42% to $3.25 billion.
Top Wedbush Analyst Is Bullish on WDC’s Q3 Earnings
Wedbush analyst Matt Bryson boosted his price target for Western Digital stock to $530 from $320 and Seagate Technology (STX) stock to $700 from $430, while reiterating a Buy rating on both stocks. The 5-star analyst noted that the HDD market entered 2026 with a major supply-demand gap, which he believes is widening due to surging investments in AI infrastructure and a higher need for data to support AI inference and training. Bryson expects this imbalance to continue further, given manufacturing limitations and rapidly growing demand.
The analyst expects WDC’s Q3 FY26 nearline units to rise to 7.6 million from 7.5 million, HDD ASP (average selling price) to increase 6%, and gross margin to expand by 140 basis points to 47.5%.
Bryson added that his Q4 FY26 pricing assumptions seem conservative, as WDC is expected to start from a higher margin base after the fiscal third quarter and could see stronger pricing than his expectations due to product mix improvements. That said, he cautioned that the near-term upside may be limited by production constraints, long-term agreements, and some memory-related headwinds.
Bank of America Raises WDC Price Target
Meanwhile, BofA Securities analyst Wamsi Mohan increased his price target for WDC stock to $495 from $415 and reaffirmed a Buy rating. For Seagate stock, Mohan raised his price target to $700 from $605 and reiterated a Buy rating.
The 5-star analyst noted that HDD supply remains tight as manufacturers are not expanding their capacity. Mohan views this as a structural change and continues to expect demand to outpace supply, with scope for further price hikes.
Mohan highlighted that the current stock price of around $400 is based on 2028 EPS of about $20 and a 20x valuation multiple. This price target assumes a CAGR (compound annual growth rate) in $/TB (dollar per terabyte) of 0% (no growth) and a 2028 operating margin of 45%. However, in a bull case, Mohan sees the possibility of higher EPS of $33, with $/TB reaching $20 in 2028 at a 3-year CAGR of 12% and an operating margin of 55%. He added that his revised price target of $495 is based on a higher multiple of 29x (prior estimate was 25x) and 2027 EPS estimate of $16.89.
Is WDC a Good Stock to Buy?
With 15 Buys and three Holds, Western Digital stock scores a Strong Buy consensus rating. The average WDC stock price target of $375.56 indicates a downside risk of 7.5%, following the massive rally over the past year.
