Western Digital Corporation (WDC)

FairStock Score: 89/100 — HIGH CONVICTION

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I approach Western Digital as a cycle-sensitive storage-hardware business, not a classic wide-moat franchise. The filed record is dramatic. In fiscal 2026, the year ended 2026-07-03, revenue was $12.9B and net income was $9.4B, or $24.28 diluted EPS, compared with $9.5B revenue, $1.9B net income, and $5.12 EPS in fiscal 2025, and a $798.0M loss and -$2.61 EPS in fiscal 2024. Fiscal Q1 2027, the quarter ended 2026-10-02, showed $4.4B revenue, $1.8B net income, and $4.63 EPS versus $2.8B, $1.2B, and $3.07 in fiscal Q1 2026. FairStock calls it a TURNAROUND because filed annual results show a return to profit after a loss within the last three years. The balance sheet looks sturdy: debt/equity is 0.13, Altman Z is 17.23, ROCE is 20.76%, and Piotroski is 6/9. But ROE of 130.85% and P/B of 17.03 tell me equity is thin and returns are distorted. At the 2026-10-26 close, FairStock shows P/E 13.23, EV/EBITDA 12.27, FCF yield 2.6%, PEG 0.06, and Graham Number $121.94, a -181.84% margin of safety. The earnings multiple is not demanding, but the asset-based and cash-yield measures are not cheap, and the 52-week range of $121.85 to $799.87 with beta 2.18 warns me this is volatile and cyclical. I see good cash generation and improving operations, but I need evidence that fiscal 2026 earnings are durable rather than a cycle peak before calling the price conservative.

In plain English: Western Digital makes hard drives and other data-storage products for computers, data centers, and consumers. Its filed results show a strong rebound: fiscal 2026 revenue was $12.9B and net income was $9.4B after a loss in fiscal 2024, and the business is generating cash. But the shares have risen sharply and look expensive on conservative measures, because the price is far above the company's accounting value and above a basic value estimate.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-26 close · note generated 2026-10-28 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q1 2027 10-Q (period ended 2026-10-02) · fiscal Q3 2026 10-Q (period ended 2026-04-03) · fiscal Q2 2026 10-Q (period ended 2026-01-02) · fiscal Q1 2026 10-Q (period ended 2025-10-03) · FY2026 10-K (period ended 2026-07-03) · FY2025 10-K (period ended 2025-06-27) · FY2024 10-K (period ended 2024-06-28)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer