Western Digital (WDC) shares surged before paring bac𝔍k some gains in early trading Friday as Rosenblatt upgraded its stock and raised its price targ🐻et, anticipating an increase in demand for the company's flash memory chips.

Rosenblatt analyst Kevin Cassidy wrote that Western Digital could benefit from an expected increase in price around the industry for the type of memory chips it makes, upgrading the stock to "buy" from "neutral," and raising its price target to $115 from $65.

"Our upgrade of WDC to a Buy recommendation is anchored on the strengthening NAND Flash market, with expected 15%+ sequential price increases in 2Q24, driven by rising demand, low inventories, and controlled capacity," Cassidy wrote. "This outlook, coupled with an adjustment in our NAND Flash ASP forecasts, underpins our increased 12-month price target of $115 for WDC, reflecting a 13x multiple on our projected NTM Non-GAAP EPS."

Rosenblatt also increased its projection for Western Digital's fourth-quarter revenue to $3.85 billion, up from $3.55 billion, as well as adjusted 澳洲幸运5开奖号码历史查询:earnings per share (EPS) to 79 cent❀s per share, up from 55 cents previously.

Western Digital is set to spin off its flash memory business from its hard drive business in the second half of 2024, after 澳洲幸运5开奖号码历史查询:first announcing the move in October, with executives sayingꦿ separating would allow the companies to focus and invest more in their respective segments of the market.

Last month, the company announced it was progressing toward the split, and said 澳洲幸运5开奖号码历史查询:Chief Executive Officer (CEO) David Goeckeler will take over the flash memory business, while Executive Vice President of Global Operations Irving Tan is set to lead the hard disk drive (HDD) company, which will retain the name Western Digital.

Western Digital shares were up about 3% as markets opened Friday before paring back some gains. They were 1.5% higher at $71.56 as of 11:25 a.m. ET. Sh💟ares are up about 40% so far this year and have more than doubled in value over the last 12 months.