Morgan Stanley Raises Western Digital Price Target to $650, Forecasts HDD Shortages to 2028
WDC•Morgan Stanley raised Western Digital’s price target to $650 from $488 and upheld an Overweight rating after Asia-based checks showed HDD shortages extending through at least 2028. The firm forecasts 40–50% annual HDD demand growth versus 30–35% supply growth, driving nearline pricing from under $15 per terabyte toward $25–30 within three years.
1. Price Target Increase and Rating
Morgan Stanley’s analyst raised Western Digital’s price target from $488 to $650 and maintained an Overweight rating after recent Asia-based checks indicated a prolonged HDD cycle. The firm highlighted Western Digital as one of its top picks alongside Seagate, citing stronger end-market dynamics supporting a sustained bullish stance.
2. HDD Demand and Supply Imbalance
Checks showed HDD demand growing 40–50% annually while supply expands only 30–35%, creating a structural shortfall expected to persist through calendar year 2028. This imbalance underscores the likelihood of ongoing tightness in nearline and high-capacity drive segments.
3. Pricing Outlook and EPS Upside
Current nearline HDD pricing sits below $15 per terabyte, but vendors are targeting $25–30 within two to three years as capacity introductions and AI-driven workload demand mount. Morgan Stanley now sees fiscal 2028 EPS estimates roughly 70% above consensus, with a potential for 10x EPS growth between 2025 and 2028 under its most bullish scenario.
