New York, Jan 21, 2026, 1:05 PM (EST) — Regular session
- Shares of Western Digital climbed roughly 7% in afternoon trading, extending a strong rally in data storage stocks.
- Citi and UBS raised their price targets, highlighting strong cloud demand and constrained drive capacity.
- Investors are zeroing in on Western Digital’s January 29 earnings and the Innovation Day scheduled for February 3.
Shares of Western Digital Corp climbed 6.9% to $238.39 on Wednesday, earlier touching $242.46, following analysts’ raises of price targets ahead of the data storage company’s upcoming quarterly report.
This matters since investors see storage as a bottleneck tied to AI computing. The biggest “hyperscalers” — major cloud operators — have maintained heavy spending on data centers, which usually drives demand for high-capacity drives and the supporting infrastructure.
As earnings approach, focus shifts from unit volumes to pricing and margins. Traders are watching to see if supply remains tight enough to keep storage prices steady, and how far in advance customers are locking in capacity.
Citi analyst Asiya Merchant bumped up Western Digital’s price target to $280 from $200, maintaining a buy rating. She cited continued strong hyperscaler data center spending as a key driver. 1
UBS bumped its price target up to $230 from $145 but maintained a neutral rating. The bank expects the December quarter to hit guidance and sees the March quarter potentially edging above consensus. Still, near-term revenue gains face limits due to tight drive capacity. 2
Bank of America bumped its price target to $257 from $197, anticipating Western Digital will hit the top end of its guidance on revenue, margins, and earnings per share. The firm projects gross margin at 44.8%, roughly 90 basis points above Western Digital’s midpoint guidance. BofA also dismissed concerns over the absence of HAMR, the hard-drive tech that boosts data density, seeing no downside there. 3
Western Digital announced Tuesday it will host an Innovation Day on Feb. 3 in New York. The company plans to showcase new technologies designed to meet growing storage needs in an “AI-driven data economy.” The event will be available via webcast. 4
Shares of Seagate Technology gained 3.1%, climbing to $336.17.
The sector’s momentum shows no signs of slowing. Citi highlighted “solid hyperscaler demand supporting higher pricing” in its 2026 outlook, a factor that’s driven gains among storage stocks like Western Digital, Investopedia reports. 5
Still, the setup works both ways. Following a sharp rally, even a slight dip in cloud orders, loosening component bottlenecks, or falling short on margin forecasts could weigh on the stock fast—especially if customers pull back on long-term capacity bookings.
Western Digital’s fiscal second-quarter results are set to drop after the market closes on Jan. 29, with a conference call scheduled for 4:30 p.m. Eastern. Investors will be zeroing in on pricing per terabyte — basically, what customers are paying for storage — and any clues on demand outlook for the latter half of the year. 6
