SanDisk tipped for success

The NAND market and SanDisk have been tipped to make investors some real money.

Krishna Shankar at ThinkEquity decided that it’s time to raise his rating on the company shares from Buy to Hold. According to Mr Shankar the company is hotly tipped to make some profits following a predicted growth in the NAND flash market for this year.

He believes that this is because the industry economics for flash memory are balanced and could lead to 75 percent to 80 percent growth.

Mr Shankar is so confident that he’s raised the price target for Sandisk to $60 from the previously suggested $50.

He’s also citing that fact that Sandisk has cosied up with Toshiba, teaming up with the giant to create a 24 nanometer and with 2 bits to 3 bits per cell process, which could put the pair ahead of the game. The company is being aggressive in its smartphone and tablet pricing.

Mr Shankar’s predictions for the NAND market reflect an industry report showing that the NAND flash memory market was buoyant in the first quarter of 2011, generating  revenue of $5.36 billion.

Researchers over at DRAMeXchange said this was up 9.9 percent from $4.88 billion in the fourth quarter of 2010.

However, investors should exercise a little bit of caution with DrameXchange claiming that the average selling price was impacted with a decline of around three percent from the previous quarter.

The researchers of course had a few views as to why this occurred. The first culprit of the decline was said to be the Toshiba/SanDisk power outage in mid-December, which of course had a knock on effect on 2011’s first quarter.

This was in addition to inventory replenishment for Chinese New Year holidays and a slow season for retail memory card and UFD market from February, which also dented profits.

Of course the Japanese crisis didn’t help the market either, with DrameXchange also claiming that it saw a “dramatic pricing fluctuation”.  

Samsung kept it’s top spot crown with a 36.2 percent market share and $1.94 billion revenue while Toshiba came in second the best with a 35.1 percent market share and $1.88 billion worth of sales.

Micron landed in third place with 11.4 percent shares and $610mn in revenue, followed lastly by Hynix with 10.7 percent shares and $574 million sales.

Bringing up the rear was Intel which came in with 6.6 percent shares and $355mn revenue.