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A number of positive industry trends have conspired to take shares of NAND flash manufacturer SanDisk (NASDAQ:SNDK) higher over the past one week. SanDisk shares are up more than 17% over the past five days after three consecutive pieces of good news in the memory industry: Western Digital announcing that China's Unis was set to acquire a 15% stake in the company at a 33% premium; Morgan Stanley raised SanDisk's rating to Overweight from Equal Weight, and Micron (NASDAQ:MU) delivered better-than-feared Q4 FY 2015 results. Despite the impressive gains, SanDisk shares are still down 39% YTD.
SanDisk stock price performance YTD
Source: SanDisk stock price data by amigobulls.com
SanDisk's woes started when the company delivered weak Q1 FY 2015 results and proceeded to issue weak guidance. SanDisk blamed the poor outlook on loss of a key customer contract, which many analysts believe was Apple (NASDAQ:AAPL) due to a poor product mix. Some analysts believe that Apple opted to source its iphone 6S SSDs from Samsung because it decided to use 2GB mobile DRAMs that utilize LPDDR4 which is Samsung's main specialty. Apple has been sourcing more mobile DRAM from Samsung in order to secure future NAND supplies. The analysts also pointed out that SanDisk's built-in thermal sensors for MacAir SSDs were faulty.
SanDisk's current woes are, however, largely near-term issues that the company is likely to soon overcome.
