Up 1,000% in the Past Year, It’s Too Late to Buy Western Digital Stock

Western Digital (WDC) demonstrates exceptional momentum, hitting all-time highs and delivering a 1,000% gain over the past year. WDC maintains a 100% “Buy” technical opinion from Barchart. Revenue and earnings are projected to grow by over 35% and 100%, respectively, this year. With 8.64% short interest and Morningstar citing 35% overvaluation, WDC is best held if already owned. It might be too late to enter a new position. 

Today’s Featured Stock

Valued at $194 billion, Western Digital (WDC) is one of the largest hard disk drive producers in the U.S. The company designs, develops, manufactures, and markets a broad range of HDDs used in desktop PCs, servers, network-attached storage devices, video game consoles, digital video recorders, and a host of other consumer electronic devices. 

What I’m Watching

I found today’s Chart of the Day by using Barchart’s powerful screening functions to sort for stocks with the highest technical buy signals; superior current momentum in both strength and direction; and a Trend Seeker “buy” signal. I then used Barchart’s Flipcharts feature to review the charts for consistent price appreciation WDC checks those boxes. The Trend Seeker issued a new “Buy” signal on April 7. Since then, the stock has gained 89.44%.

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www.barchart.com

Barchart Technical Indicators for Western Digital

Editor’s Note: The technical indicators below are updated live during the session every 20 minutes and can therefore change each day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report. These technical indicators form the Barchart Opinion on a particular stock.

Western Digital scored an all-time high of $602.53 on June 3.

Western Digital has a Weighted Alpha of +1,004.25. WDC has a 100% “Buy” opinion from Barchart. The stock has gained 1,000.89% over the past 52 weeks. Western Digital has its Trend Seeker “Buy” signal intact. The stock recently traded at $591.46 with a 50-day moving average of $414.10. WDC has made 10 new highs and gained 37.18% over the past month. Relative Strength Index (RSI) is at 80.11. There’s a technical support level around $545.67.

Don’t Forget the Fundamentals

$194 billion market capitalization. 70.39x trailing price-earnings ratio. 0.09% dividend yield. Analysts project revenue to grow 35.14% this year and another 36.77% next year. Earnings are estimated to increase 101.34% this year and an additional 77.46% next year.

Analyst and Investor Sentiment on Western Digital

The Wall Street analysts followed by Barchart give the stock 21 “Strong Buy,” 1 “Moderate Buy,” and 3 “Hold” opinions with price targets between $360 and $660. Value Line does not rank the stock but has price targets between $162 and $691. CFRA’s MarketScope rates the stock a “Buy.” Morningstar thinks the stock is 35% overvalued with a price target of $415. 90,820 investors are following the stock on Seeking Alpha, which rates it a “Hold.” Short interest is 8.64% of the float with 3.50 days to cover the float.

The Bottom Line on Western Digital

WDC is acing growth, profitability, momentum, and analyst sentiment, but its valuation is questioned by Morningstar and 8.64% of its float is being sold short. Hold it if you have it, but you may have missed the entry point.

Additional disclosure: The Barchart Chart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance.

On the date of publication, Jim Van Meerten did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

 

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