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SanDisk shares rise after Caris upgrade

Shares of SanDisk Corp. rose Wednesday after a Caris & Co. analyst upgraded the stock, predicting a strong year for computer memory card makers.
/ Source: The Associated Press

Shares of SanDisk Corp. rose Wednesday after a Caris & Co. analyst upgraded the stock, predicting a strong year for computer memory card makers.

Shares hit a new 52-week high of $32.08 in morning trading before slipping to $31.69, up $1.10, or 3.6 percent.

Despite a growing supply of memory chips, Caris analyst Craig Ellis said electronics manufacturers still have lean component inventories.

In a note to investors, he said, "Supply will still chase demand into" the fourth quarter of this year, helped by rising sales of smart phones.

Ellis said SanDisk, which is based in Milpitas, Calif., will benefit in particular since it cut costs, renegotiated its royalty agreements and rejiggered its product line last year. He upgraded the company to "Buy" from "Average," and raised his price target to $37 from $24.

He also hiked his estimate for SanDisk's earnings in 2010 to $2.75 per share, up from a previous forecast of $1.90. On average, analysts expect $1.42 per share, according to Thomson Reuters.