Western Digital (WDC) Stock Plunges 7% Amid SK Hynix Collapse and Memory Sector Turmoil

TLDR

Table of Contents

Western Digital shares declined more than 7% Monday, dropping to approximately $539 per share
SK Hynix experienced a historic collapse of over 15% in Asian trading — marking its steepest single-session decline
Korean brokerage KIS released Q2 earnings projections for SK Hynix approximately 8% beneath analyst estimates, pointing to sluggish HBM4 production growth
Fellow memory names including Micron, SanDisk, and Seagate suffered steep losses; major U.S. indices posted gains
Citi analysts retained their Buy recommendation on WDC and lifted their target to $800, though selling pressure persisted

Western Digital shares tumbled over 7% during Monday’s session, caught in a widespread selloff that hammered memory and storage stocks across the board. Trading volume was heavy as the stock changed hands near $539, significantly below its 52-week peak of $799.87.

Western Digital Corporation, WDC

The trigger for the decline had nothing to do with Western Digital’s operations or fundamentals. Instead, the culprit was SK Hynix.

SK Hynix experienced a catastrophic drop exceeding 15% during Monday’s trading session in South Korea — representing the company’s most severe single-day collapse on record. Profit-taking accelerated after a powerful rally preceding its Nasdaq debut. The rout dragged South Korea’s Kospi benchmark down 9% and triggered a 20-minute circuit breaker halt.

The contagion spread rapidly across global markets. SanDisk plummeted more than 6% before the opening bell. Micron shed over 5%. Seagate declined more than 4%. Every major memory manufacturer felt the pressure.

Bearish KIS Forecast Intensifies Pressure

South Korean financial firm KIS amplified the sector’s troubles by publishing a second-quarter earnings estimate for SK Hynix that fell roughly 8% short of Wall Street’s consensus expectations.

KIS highlighted two critical issues: HBM4 memory chip deliveries were ramping slower than anticipated, and SK Hynix’s concentrated exposure to HBM contracts was preventing the company from capitalizing on improving conventional DRAM pricing trends.

The downbeat forecast sent shockwaves through the industry. Market participants began questioning whether the artificial intelligence-driven memory boom still had legs — or if growth was beginning to decelerate.

Chip giants Nvidia, AMD, and Intel all retreated in premarket action, while SanDisk and Micron absorbed the heaviest punishment among American-listed companies.

Citi Remains Bullish Despite Selloff

Not all analysts are abandoning ship. Citi’s Asiya Merchant reaffirmed her Buy rating on Western Digital Monday while simultaneously boosting her price objective from $685 to $800.

The revision came as part of Citi’s comprehensive second-quarter earnings analysis covering the electronic components and equipment industries. Merchant has consistently highlighted constrained supply dynamics and robust AI infrastructure demand as tailwinds supporting Western Digital’s ability to maintain favorable pricing.

While the bullish stance couldn’t prevent Monday’s decline, it suggests that some Wall Street professionals view the weakness as temporary volatility rather than a fundamental shift.

The Street’s overall sentiment toward WDC remains decidedly positive. With 15 Buy recommendations and four Hold ratings issued over the last 90 days, analysts assign the stock a Strong Buy consensus rating.

The mean analyst price target stands at $648.44, suggesting roughly 11% appreciation potential from present levels.

Broader market conditions offered no support for memory stocks. The S&P 500 climbed 0.4%, the Dow Jones advanced 0.3%, and the Nasdaq gained 0.3% — underscoring that Monday’s selloff was industry-specific rather than reflective of broader economic concerns.

Western Digital’s 52-week high remains $799.87. With shares currently hovering around $539, a substantial valuation gap exists between current trading levels and analyst expectations.

Citi’s $800 price target, reaffirmed despite the brutal session, keeps that upside potential firmly in focus for investors willing to look past near-term volatility.

✨ Limited Time Offer