Craig-Hallum analyst Christian Schwab upgraded Western Digital Corp. WDC, -0.53% shares to buy from hold on Thursday, writing that while the exact timing of a NAND supply/demand recovery is hard to pinpoint, he expects that the environment will inevitably normalize. “We believe the time to buy cyclical stocks is after they have gotten crushed, not when the environment is positive and the industry is arguing they are no longer cyclical,” wrote Schwab, who has a $59 target price on the shares. His upgrade comes after Western Digital’s Tuesday analyst day, during which the company discussed slowing mobile-phone growth but a somewhat better-than-expected PC landscape. Shares are up 0.2% in Thursday morning trading. Other analysts were downbeat following the commentary from management. “Add it all up and we continue to see risk to the name with a reset on the horizon and net debt of $20/share adding potential risk to the dividend in a protracted downturn,” wrote Evercore ISI’s C.J. Muse, who has an in-line rating and $35 target on the stock. Cowen & Co.’s Karl Ackerman lowered his target to $50 from $50 and kept a market-perform rating on the shares, writing that the “financial picture remains cloudy” for the next several quarters. “This, unfortunately, will supersede the company’s systematic progression toward a more margin-rich, sustainable product portfolio,” he said. WDC’s stock has fallen 46% so far this year, while the S&P 500 SPX, -2.25% has dropped 0.7%.
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