11:04 AM EDT, 08/15/2024 (MT Newswires) -- Western Digital ( WDC ) will likely announce a split before end of the year, with the hard disk drive portion of the business accounting for nearly "the entirety of the total company valuation," while SanDisk is "effectively valued close to nothing," Wedbush said in a note on Thursday.

Wedbush said SanDisk as a standalone entity could be valued between $10 billion and more than $20 billion, with the high-end valuation likely achievable by 2025 due to expected prolonged NAND shortages.

Inventory reductions by original equipment manufacturers and a softened retail market have reduced the outlook for calendar Q4 NAND bit shipments and pricing, lowering the expected earnings per share for the December quarter, according to the note.

Wedbush said it sees the inventory reductions as temporary, not cyclical, with expectations that market fundamentals will improve once inventories are reduced.

The firm reiterated its outperform rating on Western Digital's ( WDC ) shares and kept the price target at $95.

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