A $31 Billion Reason to Buy Sandisk Stock Now

Sandisk (SNDK) is making a massive long-term bet on Japan as artificial intelligence drives demand for memory chips higher.

The company is working with Kioxia (KXIAY) on plans to invest up to $31 billion in Japan through 2032, with the capital earmarked for expanding NAND flash production at their Yokkaichi and Kitakami facilities.

For Sandisk, this is about much more than adding manufacturing capacity. The investment could help secure long-term supply, strengthen its relationship with Kioxia, and position the company to capture more of the rapidly expanding AI data center market.

SNDK stock is already up roughly 534% in 2026, raising the question of whether this latest investment can support another leg higher.

SNDK Stock Has Already Exploded Higher

Sandisk shares have delivered extraordinary gains over the past year, climbing roughly 2,859%, while the stock is up about 24% in just the past month.

The AI infrastructure boom has been the primary catalyst, with investors increasingly viewing NAND memory as a critical component of the data center buildout.

However, the rally has also brought significant volatility. SNDK shares plunged roughly 47% in July after investors reacted to stretched expectations and guidance that was not as strong as some had hoped.

Despite the enormous rally, SNDK does not look prohibitively expensive based on the valuation metrics provided.

The stock trades at roughly 20 times trailing earnings, compared with about 30 times for the broader technology sector. That represents a discount of roughly 44%.

Why Sandisk Is Investing $31 Billion in Japan

The partnership with Kioxia gives Sandisk an opportunity to expand production capacity at a time when demand for NAND flash memory is accelerating.

The companies have been strategic partners in Japan for more than 25 years and have already invested more than $50 billion in the country. The latest commitment reinforces that relationship while potentially receiving substantial support from the Japanese government.

The investment is expected to expand the Yokkaichi and Kitakami plants, with a third production facility planned at Kitakami and operations expected to begin in or after 2029.

For SNDK shareholders, the biggest benefit may be supply security. AI data centers require enormous amounts of storage, and NAND is becoming increasingly important as hyperscalers expand their infrastructure.

The investment also gives Sandisk a path to participate in future AI-driven memory demand rather than simply reacting to shortages.

Record Numbers Show Why AI Matters

Sandisk's fiscal fourth-quarter results offered further evidence of that growth opportunity.

Revenue reached $8.97 billion, up 51% sequentially and 372% year-over-year (YoY), beating expectations of $8.39 billion. Adjusted EPS surged to $39.25 from just $0.29 a year earlier, while adjusted gross margin climbed to 84.6%.

Free cash flow reached $7.08 billion, giving Sandisk significant financial flexibility as it prepares to invest heavily in future capacity.

For fiscal Q1 2027, management expects revenue between $10.3 billion and $10.8 billion, with adjusted EPS of $44 to $46.

Beyond Japan, Sandisk is also benefiting from broader AI storage demand and is expanding its data center business as enterprises and cloud providers build out increasingly storage-intensive AI infrastructure.

Wall Street Opinion on SNDK Stock

The analyst community is quite optimistic on SNDK stock. Sandisk carries a bullish “Strong Buy” consensus rating, with the average analyst price target around $2,144. That implies roughly 43% upside from current levels.

Recently, JPMorgan upgraded SNDK to “Overweight” with a $2,250 target, while Goldman Sachs reiterated its “Buy” rating and $2,200 target. Bank of America maintained a “Buy” rating with a $2,500 target, and Morgan Stanley kept its “Overweight” rating with a $1,750 target.

Bernstein is even more bullish, with a $3,000 price target.

The wide range of targets tells of the uncertainty surrounding a stock that has already delivered extraordinary gains. Still, Wall Street's overall stance suggests analysts believe Sandisk's AI exposure, stronger NAND demand, and long-term capacity investments in Japan can support further upside.