Shares of companies providing memory chips and data storage solutions have witnessed a sharp sell-off over the past month. Much of this selling pressure comes from a growing caution regarding the massive artificial intelligence (AI) capital expenditures by tech giants.
While demand for AI infrastructure remains healthy, concerns have emerged that the massive capital investments being made by hyperscalers may take longer than expected to deliver meaningful financial returns. That uncertainty has prompted investors to reduce exposure to high-growth semiconductor names, particularly those that had rallied sharply earlier this year.
This anxiety is compounded by profit-taking and macroeconomic headwinds. Following a powerful surge in early 2026 that pushed valuations to extended levels, investors eagerly locked in gains. Meanwhile, a fresh wave of geopolitical friction, highlighted by recent U.S. and Iran airstrikes, has fueled a global risk-off environment. This friction has pushed Treasury yields higher, pulling capital away from high-growth tech investments to safer assets.
As a result, prominent memory-related companies like SanDisk Corporation SNDK, Micron Technology, Inc. MU, Seagate Technology Holdings Plc STX and Western Digital Corporation WDC have seen their stock prices plunge by more than 14% over the past month. These equities now trade roughly 25% to 30% below their recent 52-week highs.
Memory Stock One-Month Price Return Performance
Image Source: Zacks Investment Research
The decline has compressed valuations to levels well below their one-year high. Given the industry's improving supply-demand balance, continued AI-led memory demand and growing enterprise storage needs, the recent correction may offer long-term investors an attractive opportunity to accumulate quality memory and data storage stocks — SanDisk, Micron Technology, Seagate Technology and Western Digital — at more reasonable prices.
These stocks have a favorable combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy), offering solid investment opportunities. These have also witnessed upward earnings estimate revision within the last 30 days, indicating bullish analysts’ views about their long-term prospects.
SanDisk Benefits From NAND Recovery
SanDisk is entering a favorable phase as the NAND flash market gradually recovers from a prolonged downturn. The company continues to benefit from disciplined industry-wide production management, which is helping improve pricing across consumer, enterprise and cloud storage markets. Strong demand for high-capacity SSDs used in AI servers and enterprise data centers is creating a healthier pricing environment after several quarters of weakness.
SanDisk is also expanding its portfolio of high-performance storage products designed for AI workloads, gaming and enterprise applications. As hyperscalers continue investing in storage infrastructure to support AI training and inference, demand for advanced NAND solutions is expected to rise.
In the last reported financial results for the third quarter of fiscal 2026, SanDisk’s revenues jumped 251% year over year to $5.95 billion. The company reported non-GAAP earnings per share (EPS) of $23.41, a robust improvement from the year-ago quarter’s loss of 30 cents.
Combined with lower valuation multiples following the recent correction, SanDisk appears well-positioned for a recovery once market sentiment improves. The company's forward 12-month price-to-earnings (P/E) valuation multiple of 8.61 remains well below the one-year high of 42.06. At the closing price of $1,673.97 as of July 13, SNDK stock trades nearly 29% lower than its 52-week high of $2,354.39.
The Zacks Consensus Estimate for fiscal 2026 and 2027 earnings has been revised upward over the past seven days and indicates a year-over-year increase of approximately 2,125% and 193%, respectively. Currently, SanDisk sports a Zacks Rank of 1 and has a Growth Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.
Sandisk Corporation Price and Consensus
Sandisk Corporation price-consensus-chart | Sandisk Corporation Quote
Micron Remains an AI Memory Leader
Micron continues to stand out as one of the strongest long-term beneficiaries of the AI revolution. The company has established itself as a leading supplier of high-bandwidth memory (HBM), a critical component used alongside advanced AI graphics processing units. Demand for HBM remains exceptionally strong as leading cloud providers and AI chipmakers expand next-generation AI infrastructure.
In the most recently reported financial results for the third quarter of fiscal 2026, revenues soared 346% year over year to $41.46 billion, while non-GAAP EPS jumped to $25.11 from $1.91 reported in the year-ago quarter.
Beyond HBM, Micron continues to see healthy demand for data center DRAM and enterprise SSDs. The company has secured 16 long-term supply agreements with major customers, improving revenue visibility while supporting capacity planning. At the same time, better pricing across DRAM and NAND markets should support higher profitability over the coming quarters.
The company's forward 12-month P/E valuation multiple of 6.58 remains well below the one-year high of 17.01. At the closing price of $937 as of July 13, MU stock trades 25% lower than its 52-week high of $1,255.
The Zacks Consensus Estimate for fiscal 2026 and 2027 earnings has been revised upward over the past 30 days and indicates a year-over-year surge of 791% and 107%, respectively. Currently, Micron sports a Zacks Rank #1 and has a Growth Score of A.
Micron Technology, Inc. Price and Consensus
Micron Technology, Inc. price-consensus-chart | Micron Technology, Inc. Quote
Seagate Technology Benefits From Massive Data Growth
STX remains a key player in the rapidly growing data storage industry. While solid-state drives continue gaining market share, high-capacity hard drives remain the most cost-effective solution for storing massive volumes of AI-generated and enterprise data. This makes Seagate Technology an important supplier to hyperscale cloud providers building large-scale storage infrastructure.
The company is also leading the transition toward heat-assisted magnetic recording (HAMR) technology, enabling significantly higher storage capacities while improving customer economics. As enterprises and cloud providers continue expanding storage requirements, the adoption of these next-generation drives is expected to accelerate. In the third quarter of fiscal 2026, STX’s revenues and non-GAAP EPS surged 44% and 116%, respectively, on a year-over-year basis.
Following the recent share price correction, Seagate Technology now trades at a much more attractive valuation relative to its long-term growth prospects. The company's forward 12-month price-to-earnings (P/E) valuation multiple of 29.81 is significantly lower than the one-year high of 64.57. At the closing price of $860.66 as of July 13, STX stock trades approximately 25% lower than its 52-week high of $1,145.
The Zacks Consensus Estimate for fiscal 2026 and 2027 earnings has been revised upward over the past 30 days and indicates a year-over-year increase of 84% and 88%, respectively. Currently, Seagate Technology sports a Zacks Rank #1 and has a Growth Score of A.
Seagate Technology Holdings PLC Price and Consensus
Seagate Technology Holdings PLC price-consensus-chart | Seagate Technology Holdings PLC Quote
Western Digital Leverages AI Storage Demand
Western Digital is benefiting from rising demand for high-capacity hard disk drives across enterprise and cloud markets. AI applications generate enormous amounts of data that require reliable long-term storage, creating opportunities for the company's broad portfolio of storage solutions.
As cloud providers expand storage capacity to accommodate AI-generated data, Western Digital should see an improvement in demand across multiple product categories. Cost optimization initiatives and improving industry pricing also provide additional support for margin expansion. In the third quarter of fiscal 2026, WDC’s revenues and non-GAAP EPS surged 45% and 97%, respectively, on a year-over-year basis.
With the stock trading well below its 52-week high, investors are now paying a much lower valuation for a business positioned to benefit from long-term AI-driven storage growth. The company's forward 12-month P/E valuation multiple of 28.99 is significantly lower than the one-year high of 62.15. At the closing price of $555.55 as of July 13, WDC stock trades nearly 31% lower than its 52-week high of $799.87.
The Zacks Consensus Estimate for fiscal 2026 and 2027 earnings has been revised upward over the past 30 days and indicates a year-over-year increase of 104% and 85%, respectively. Currently, Western Digital sports a Zacks Rank #1 and has a Growth Score of B.
Western Digital Corporation Price and Consensus
Western Digital Corporation price-consensus-chart | Western Digital Corporation Quote
Beyond Nvidia: AI's Second Wave Is Here
The AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.
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This article originally published on Zacks Investment Research (zacks.com).