Western Digital Corp. (NASDAQ:WDC) stock fell about 6% in Monday’s premarket session as investors pulled back from growth-focused technology stocks. Nasdaq futures dropped 1.60%, while S&P 500 futures fell 0.66%.
Western Digital’s slide mirrored a broader rout across memory and storage stocks. Sandisk Corporation (NASDAQ:SNDK) and Micron Technology Inc. (NASDAQ:MU) fell nearly 6%. Meanwhile, SK hynix Inc. (NASDAQ:SKHY) dropped more than 7%, and Seagate Technology Holdings plc (NASDAQ:STX) fell more than 4%.
The sector weakened as investors reassessed the outlook for AI infrastructure spending. The Financial Times reported that calls to slow AI development over safety concerns have raised questions about future capital spending. That could weigh on demand for AI hardware, including memory and storage products used in data centers.
Technical Analysis
Western Digital is showing short-term weakness despite a stronger long-term trend.
The stock trades about 10% below its 20-day simple moving average of $466.73. It is also 15% below its 50-day SMA of $494.82 and 17% below its 100-day SMA of $510.67.
However, shares remain about 11% above the 200-day SMA of $379.22. That points to a short-term downtrend within a longer-term bullish structure.
Meanwhile, MACD remains above its signal line, with a positive histogram. That suggests bearish momentum may be easing.
Traders could watch $421 as near-term support. A rebound could face resistance around $480.
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Analyst Outlook
The stock has a Buy consensus rating and an average price forecast of $649.79, based on 31 analysts.
Citigroup maintained a Buy rating on Aug. 7 but lowered its price forecast to $740. TD Cowen maintained Buy and raised its forecast to $540 on Aug. 6. UBS maintained Neutral and lowered its forecast to $525 the same day.
Benzinga Edge Rankings
Western Digital scores strongly on Benzinga Edge for momentum, growth and quality.
Its Momentum score stands at 98.96, while Growth is 99.74 and Quality is 96.22. However, its Value score is much weaker at 5.9.
The readings suggest strong underlying momentum and growth, but a less attractive valuation profile.
Top ETF Exposure
- Alger Concentrated Equity ETF (NYSE:CNEQ): 4.56% Weight
- Pacer US Large Cap Cash Cows Growth Leaders ETF (NASDAQ:COWG): 4.37% Weight
- Invesco Dorsey Wright Technology Momentum ETF (NASDAQ:PTF): 4.45% Weight
Significance: Because WDC carries significant weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.
Price Action
WDC Stock Price Activity: Western Digital shares were down 6.00% at $420.35 during premarket trading on Monday, according to Benzinga Pro data.
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