What to Look for in SanDisk Earnings

SanDisk Corp. (NASDAQ: SNDK) is set to report its first-quarter financial results after the markets close on Wednesday. Thomson Reuters has consensus estimates of $0.55 in earnings per share (EPS) on $1.21 billion in revenue. That compares to EPS of $0.62 and $1.33 billion in revenue posted in the same period from last year.

Many have felt that this top chip company will be a winner in the storage migration. SanDisk is a global leader in flash storage solutions. For more than 27 years, it has expanded the possibilities of storage, providing trusted and innovative products that have transformed the electronics industry. Today, SanDisk’s quality, state-of-the-art solutions are at the heart of many of the world’s largest data centers and embedded in advanced smartphones, tablets and personal computers.

Western Digital had put together a deal back in October to buy the company for $19 billion. When it was announced that China’s Unisplendour had scrapped its planned $3.78 billion investment in the company, that in turn altered the terms of Western’s deal for SanDisk. Reportedly the company would present an alternative offer for SanDisk consisting of more Western Digital stock and less cash, giving the deal an overall value of $15.78 billion. The value of the deal for SanDisk was $78.50 per share, down from $86.50 when it was originally struck, according to Sumit Sadana, a SanDisk executive vice president.
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A few analysts weighed in on SanDisk prior to its earnings release:

• Citigroup reiterated a Neutral rating with a $77.50 price target.
• Wedbush has an Outperform rating with an $86 price target.
• Robert Baird has a Neutral rating with a $60 price target.
• RBC Capital has an Outperform rating with an $84 price target.

So far in 2016, SanDisk has performed relatively flat, with the shares down less than 1%. Over the past 52 weeks, the share price has increased 13%.

Shares of SanDisk were trading at $75.75 on Wednesday, with a consensus analyst price target of $76.82 and a 52-week trading range of $44.28 to $78.83.