Rising 9% Last Month, What’s Next For Western Digital Stock?

Western Digital stock (NASDAQ: WDC) is up more than 9% in just one month (21 trading days), completely outperforming the S&P 500 which was up just a little under 5%. If you look at the change over the last five and ten days, too, the stock has returned 8.6% and 12%, respectively, thus having outperformed the market on both occasions. Western Digital reported strong Q1 2021 earnings at the end of October (Western Digital’s fiscal year ends in June), with revenue jumping to $5.05 billion from $3.92 billion in Q1 ’20, driven by a $700 million rise in HDD sales, now standing at par with Flash sales (which rose $400 million to $2.5 billion). With COGS and other operating expenses in check, operating income rose 11x from $70 million in Q1 ’20 to $778 million in Q1 ’21. A drop in the effective tax rate further benefited WDC, driving EPS from -$0.20 to $1.97 over this period.

Now, is WDC stock set to rise further or could we expect some correction? We believe that there is a decent 60% chance of a rise in WDC stock over the next month (21 trading days) based on our machine learning analysis of trends in the stock price over the last ten years. See our analysis on WDC Stock Chance of Rise. For additional details about WDC historical returns and comparison to peers, see Western Digital (WDC) Stock Return.

Twenty-One Day: WDC 9.3%, vs. S&P500 4.8%; Outperformed market

(23% likelihood event; 60% probability of rise over next 21 days)

• WDC stock increased 9.3% the last twenty-one trading days (one month), compared to a broader market (S&P500) rise of 4.8%
• A change of 9.3% or more over twenty-one trading days is a 23% likelihood event, which has occurred 571 times out of 2516 in the last 10 years
• Of these 571 instances, the stock has seen a positive movement over the next twenty-one trading days on 342 occasions
• This points to a 60% probability for the stock rising over the next twenty-one trading days

Ten Day: WDC 12%, vs. S&P500 1.6%; Outperformed market

(7% likelihood event; 57% probability of rise over next 10 days)

• WDC stock increased 12% over the last ten trading days (two weeks), compared to broader market (S&P500) rise of 1.6%
• A change of 12% or more over ten trading days is a 7% likelihood event, which has occurred 175 times out of 2517 in the last 10 years
• Of these 175 instances, the stock has seen a positive movement over the next ten trading days on 100 occasions
• This points to a 57% probability for the stock rising over the next ten trading days

Five Day: WDC 8.6%, vs. S&P500 -0.4%; Outperformed market

(6% likelihood event; 52% probability of rise over next five days)

• WDC stock increased 8.6% over a five-day trading period ending 11/12/2021, compared to the broader market (S&P500) drop of 0.4%
• A change of 8.6% or more over five trading days (one week) is a 6% likelihood event, which has occurred 163 times out of 2517 in the last ten years
• Of these 163 instances, the stock has seen a positive movement over the next five trading days on 84 occasions
• This points to a 52% probability for the stock rising over the next five trading days

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