Western Digital shares surge 5.09% premarket as Morgan Stanley sets $369 street-high price target on AI/cloud demand.

Western Digital surged 5.09% in premarket trading following a revised $369 street-high price target from Morgan Stanley, which cited AI-driven demand for high-capacity storage as a "sustainable tailwind." The firm highlighted the company’s 20% annual revenue growth target, 50% gross margin roadmap, and $20 EPS guidance, aligning with Western Digital’s recent Q2 earnings beat and record 215 exabyte storage shipments. Additionally, the company’s Innovation Day announcement of 100TB HAMR HDDs by 2029 and AI-optimized storage platforms reinforced investor confidence in its long-term dominance in cloud and hyperscale data centers. These developments, coupled with multi-year purchase commitments from major cloud clients and $4 billion in new buyback authorization, positioned the stock for upward momentum ahead of its elevated valuation metrics.