Is It Too Late to Buy Sandisk Stock?

Sandisk (NASDAQ: SNDK) has been the surprise winner in artificial intelligence (AI) development this year. The company, which has been around for decades as a memory and storage company, was spun off from Western Digital in February 2025 at a humble initial public offering (IPO) price of $38.50. That share price has since skyrocketed 3,640% to $1,440.

That's a lot of share price appreciation in a relatively short time. Is it at the end of its historic run? Or is there still time to buy this growth stock?

Sandisk is filling a gap in AI

What has turned Sandisk stock into a star is its NAND memory products, which are important for many types of technology, including data centers and smartphones. NAND is a type of memory that's non-volatile, which means it stores data even in an "off" state, and it's high-density, which is more cost-effective. This kind of memory is crucial for training AI models, allowing them to store massive amounts of data and use it for training purposes.

Image source: Getty Images.

As hyperscalers continue to expand, memory is becoming more scarce and therefore more expensive, even at the cost-effective level. Not only are Sandisk's products in soaring demand, but they're also increasing in price, and Sandisk has been reporting outstanding operating results. In the 2026 fiscal third quarter (ended April 3), revenue increased 97% sequentially and 251% year over year, and adjusted earnings per share (EPS) were $23.41, up from $5.15 the previous quarter.

CEO David Goeckeler noted that the company is benefiting from a shift to data centers, which he calls "higher-value customers," from its previous focus on other kinds of technology. Data center revenue increased 233% in the quarter. Another development is that it's moving to a business model based on multiyear agreements. That's beneficial for both sides, since customers have committed storage and Sandisk has committed revenue. It signed three of what it calls "new-business model" agreements in the third quarter and another two already in the fourth quarter.

The ongoing opportunity for Sandisk

At least in the near term, it still looks like Sandisk has an incredible opportunity. The industry is speeding up, not slowing down, and management has figured out a more secure and lucrative business model that locks in multiyear revenue commitments.

Management is guiding for 80% gross margin in the fourth quarter, slightly up from 78.4% in the third quarter, and about $8 billion in revenue, up 321% from last year.

After gaining roughly 3,640%, Sandisk stock has become a lot more expensive, trading at 16 times trailing-12-month sales, up from around 4.5 at the start of this year. That makes it more susceptible to dips from anything ranging from global news to company-specific data.

Putting this all together, I don't think it's too late to buy Sandisk stock. But don't expect the same massive gains (although that's still possible), and do expect some volatility. If you decide to invest, I wouldn't make it a prime position.

Jennifer Saibil has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Western Digital. The Motley Fool has a disclosure policy.