This ‘Strong Buy’ AI Stock Could Jump 56% —Time to Buy?

Core Viewpoint - The artificial intelligence (AI) ecosystem is experiencing significant growth, with Western Digital (WDC) being a standout performer, showing a year-to-date share increase of 249.1% driven by AI-related demand for storage solutions [1][2]. Company Performance - Western Digital's stock surge is primarily attributed to the increasing demand for its high-capacity hard disk drives (HDDs), which are crucial for storing large volumes of data generated by AI systems [2]. - In the first quarter of fiscal 2026, Western Digital reported a 27% year-over-year revenue increase, with earnings per share (EPS) rising 137% to $1.78, reflecting strong profitability driven by high demand for nearline hard drives [5]. Market Outlook - Analysts maintain a "Strong Buy" rating for Western Digital, with a price target of $250, indicating a potential upside of approximately 56% from its recent closing price of $159.99 [3]. - The company is expected to sustain its growth momentum due to ongoing investments in AI infrastructure, with strong performance carried over from fiscal 2025 into fiscal 2026 [4]. Customer Commitments - Western Digital's management noted that customers are increasingly locking in supply contracts well in advance, with seven major buyers committing to orders extending into the first half of 2026, and a significant hyperscaler securing products through 2027 [6].