WDC Western Digital

Western Digital designs and manufactures hard disk drives and flash storage products for consumer electronics, data centers, and enterprise customers. Sector: Technology.

Western Digital (WDC) is an individual stock. The analysis below presents key financial metrics for the company, covering profitability, capital efficiency, valuation, margins, and growth.

Through the lens of capital efficiency, ROIC is 30.77%, WACC is 14.02%, and the economic spread is 16.74%. On balance, the gap between operating returns and funding costs is healthy, pointing to businesses with genuine pricing and reinvestment advantages. Supporting metrics show ROE at 46.45% and ROA at 15.66%, a combination that helps frame whether profitability strength is broad enough to hold through different market conditions. Taken together, the return profile suggests a company with credible compounding capacity if current operating execution persists.

Assessed on a multiple basis, trailing P/E of 28.57, forward P/E of 23.82, PEG of 0.58. Forward P/E tracks closely with trailing P/E — a sign that the market sees the current earnings run rate as a reasonable baseline going forward. At this PEG level, the company offers what growth investors typically look for: earnings expansion priced at a reasonable relative multiple. The company's weighted current ratio of 1.45 suggests near-term liquidity is more constrained than average. Overall, the valuation setup reads as a balance between expected growth and execution risk, with liquidity acting as an important stabilizer if macro conditions become less favorable.

The margin profile breaks down as follows: gross margin sits at 42.72%, operating margin at 27.96%, and free cash flow margin at 21.48%. Gross margins are in good shape, suggesting the the company maintain pricing discipline at the revenue-to-cost interface. Operating margins are solid, reflecting adequate cost control relative to the revenue base. The company's FCF margin is healthy, indicating solid cash conversion after capital expenditure needs. This stack calls for monitoring: profitability is present, but conversion from revenue to operating income to free cash is not fully consistent.

The near-term directional case rests on two inputs: TTM revenue growth of 25.24% pointing to healthy demand conditions for the company represented in the company. In parallel, analyst price targets collectively imply a decline from current levels based on current consensus targets. The two figures measure different things — one reflects what businesses are actually delivering, the other what the market expects them to deliver. The extent to which these signals converge or diverge will likely be a primary driver of realized returns relative to current expectations. The estimated 12-month price change is based on analyst consensus price target estimates, sourced from publicly available data, and should not be interpreted as a reliable prediction of future performance.

The data points reviewed collectively point toward a positive outcome if execution holds — the setup is favorable even accounting for the inherent uncertainty in forward estimates.

This summary is based on publicly available quantitative data and is not intended as investment advice. Carefully consider your personal financial circumstances before making any decisions.