QM · rank #2 · 2026-10-26
WDC
NASDAQ · $132.58B (USD)
The exact numbers the algorithm saw.
| Momentum 12-1 Return from 12 months ago to 1 month ago. | +327.95% |
|---|---|
| ROE TTM Return on equity, trailing 12 months. | +130.8% |
| Profit margin Net profit margin, trailing 12 months. | +73.0% |
| Market cap (USD) Size filter: > $500M required. | $132.58B |
| Anchor (recent) Close on 2026-09-25 | $456.81 |
| Anchor (far) Close on 2025-09-26 | $106.74 |
The AI research card
Independent qualitative review of each pick before the order is placed. On the rare day the research service is unavailable, the paper book trades on the quant ranking alone and no card appears here.
Summary
Western Digital is a pure-play HDD company supplying high-capacity nearline drives to hyperscalers, with cloud customers representing 89% of fiscal 2026 revenue and AI-driven data growth accelerating demand.
Rationale
The quality_momentum signal is reinforced by concrete fundamentals: 55% YoY revenue growth, 161% EPS growth, 58.1% gross margin, $1.38B of free cash flow, and raised Q2 guidance—momentum here is earnings-driven, not sentiment-only.
Material risks
- 189% cloud-revenue concentration with top-10 customers at 73% of revenue means a single hyperscaler capex pause or insourcing decision could collapse the demand signal that is driving both the momentum and quality scores.
- 2HAMR qualification and manufacturing scale-up at hyperscalers remains unproven at volume; a delay or reliability failure in the 2027 ramp would undercut the forward earnings trajectory underpinning current valuation multiples.
AI verdict council
Each pick is reviewed independently by 3 models before any order. 3 of 3 voted to proceed.