SanDisk Corp (SNDK) recently raised its outlook, shares and estimates have responded favorable.
Company Description
SanDisk Corp. makes memory-based semiconductors for a variety of consumer electronics. The flash storage devices are used in removable cards, USB drives and are hardwired into other products.
Outlook Jumps
On Mar 1 SanDisk raised its guidance for the first quarter of 2010. The Zacks #1 Ranked company is now expecting revenue between $925 million and $1 billion, raising both ends of the range by $50 million. SanDisk sited strong demand and better pricing capacity.
Estimates Up
In the past month we have seen 16 upward revisions for full-year 2010 and not a single downward change. The Zacks Consensus Estimate is now $2.41, up from $1.87.
Next year’s estimates are averaging $2.73, up from $1.93 during that span. Given the $1.61 earned in 2009, projected growth is 50% this year and 13% next year.
SanDisk remains a solid value as the estimate revisions kept up with the price improvement. Shares of SNDK are going for just under 14 times forward earnings. The PEG ratio is about 1.0, so those growth rates are fairly priced.
The Chart
SanDisk is trading at a multi-year high following the latest upgrade. You can see below, shares surged on the raised guidance and continue to climb.
Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Growth Trader serviceZacks Investment Research
