WDCWDC
US • —
$519.80
P/E
30.51
PEG
0.11
FCF Yield
1.6%
Rev Growth YoY
+32.0% YoY
Gross Margin
45.4%
Health Score
8/10
D/E Ratio
0.85
Confidence
MEDIUM
Business Snapshot
Western Digital Corporation designs, manufactures, and sells data storage products and solutions, including hard disk drives (HDDs) and solid-state drives (SSDs), serving cloud, enterprise, and consumer markets. It operates in the highly competitive data storage industry, where it is a major player alongside Seagate Technology and semiconductor-focused memory manufacturers. With a market capitalisation of $186.55 billion, it is classified as a large-cap company, though TTM revenue figures are not available in this data set for scale comparison. A defining characteristic of Western Digital is its vertical integration in NAND flash memory through its joint venture with Kioxia, providing a strategic position in the rapidly growing flash storage market.
Financial Health
Western Digital reports a robust gross margin of 45.4%, with year-over-year prior period data not available for trend comparison, while its net margin stands at a very strong 55.3%. The balance sheet appears healthy, with a Debt/Equity ratio of 0.85x, indicating moderate leverage, and a Current Ratio of 1.08x, suggesting adequate short-term liquidity...
Risk Assessment
- VALUATION — P/E ratio of 30.51x is elevated versus the sector average of 22x, representing a premium that requires sustained high growth to justify.
- VALUATION DIVERGENCE — The Python DCF estimate of $140.57 suggests the current price of $519.80 represents a significant 270% premium, raising a major red flag for intrinsic value.
- EARNINGS QUALITY — While earnings growth is very strong at 269.2%, net margin at 55.3% is exceptionally high and may be unsustainable, warranting closer scrutiny of earnings quality.
- TECHNICALS — RSI, MACD, and moving average data unavailable for this period; momentum cannot be independently confirmed.
- INSIDER ACTIVITY — Insiders have been net sellers over the last 90 days, with 0 buys versus 1 sell, a cautious signal for existing shareholders....
Western Digital reports a robust gross margin of 45.4%, with year-over-year prior period data not available for trend comparison, while its net margin stands at a very strong 55.3%. The balance sheet appears healthy, with a Debt/Equity ratio of 0.85x, indicating moderate leverage, and a Current Ratio of 1.08x, suggesting adequate short-term liquidity. The company generated $2.90 billion in positive Free Cash Flow, yielding a 1.6% FCF yield, demonstrating its ability to convert earnings into cash. Overall, strong profitability and positive cash generation provide the company with ample capacity for reinvestment in its technology roadmap and potential shareholder returns.
- VALUATION — P/E ratio of 30.51x is elevated versus the sector average of 22x, representing a premium that requires sustained high growth to justify. - VALUATION DIVERGENCE — The Python DCF estimate of $140.57 suggests the current price of $519.80 represents a significant 270% premium, raising a major red flag for intrinsic value. - EARNINGS QUALITY — While earnings growth is very strong at 269.2%, net margin at 55.3% is exceptionally high and may be unsustainable, warranting closer scrutiny of earnings quality. - TECHNICALS — RSI, MACD, and moving average data unavailable for this period; momentum cannot be independently confirmed. - INSIDER ACTIVITY — Insiders have been net sellers over the last 90 days, with 0 buys versus 1 sell, a cautious signal for existing shareholders.
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