SNDK at $934, did you cut your losses?
Falling from 2350 to 934, down 60%, the AI bubble theory is shouted loudly. But just now, the earnings report exploded: revenue surged 378% year-over-year, gross margin 85%, PE only 7 times—cheaper than Moutai. Is this the last dip of the AI downturn, or a golden opportunity before the stock split?
First, the surface: AI sector collectively corrected, SNDK halved from the June high of 2350 to 860 in the spot stock, perpetual at 934. Everyone is shouting "AI bubble burst." But the candlestick tells you: after touching around 800 in early November, it stopped falling and rebounded, RSI recovered from the oversold zone at 25, and a double bottom pattern is emerging.
First thing: revenue surged 378%, gross margin 85%, PE only 7 times.
Earnings report on October 29, 2026: Q1 revenue $11.031 billion, up 378% year-over-year, up 23% quarter-over-quarter. Data center revenue $4.8 billion, up 61% quarter-over-quarter. Gross margin 85%.
What does an 85% gross margin mean? Moutai 90%, Apple 45%, NVIDIA 70%+. SNDK achieved 85%.
More painfully, valuation: PE (TTM) about 7 times. Analyst target price 1300-2000+ (pre-split basis).
A leading AI storage company with nearly 4x revenue growth and 85% gross margin, the market only gives it a 7x PE. If you say it's a bubble, then what isn't?
Second thing: NAND shortage until 2027-2028, capacity locked until 2030.
AI training requires storage, AI inference requires storage, KV cache requires storage. eSSD already accounts for nearly half of NAND shipments.
SNDK's long-term take-or-pay contracts (including hyperscalers) are huge, capacity locked until around 2030. Cash-rich, almost no debt.
This is not storytelling, these are contracts in black and white. Worried about AI capital expenditure slowing? Fine, then see if those hyperscalers with long-term contracts agree.
Supply side is even tougher: NAND remains tight until 2027-2028, China's YMTC cannot fill the gap in the short term. Supply is locked, demand is locked, who controls the price?
Third thing: 8-for-1 stock split, not bad news, but a positive scheme.
Record date November 9, distribution after close on November 19, trading at split price on November 20. Binance has announced support for bStocks and perpetual contract adjustments.
Stock split does not change market cap but lowers the price per share, improving retail accessibility and options liquidity.
Worried about "buy the rumor, sell the fact" volatility before the split? The split is a positive scheme to let retail investors afford it. $860 per share is unaffordable for many; after the split, $107 per share lowers the threshold directly.
Historically, every stock split causes short-term emotional volatility but long-term liquidity dividends. Apple split, Tesla split, NVIDIA split. All rose after the split.
But where is the risk? You decide.
On one side:
Revenue +378%, gross margin 85%, PE only 7 times
Data center revenue +61% quarter-over-quarter, AI storage is a rigid demand
Capacity locked until 2030, NAND shortage until 2027-2028
Down over 60% from the high, RSI oversold recovery, double bottom pattern
8-for-1 stock split, liquidity dividend imminent
On the other side:
AI sector overall correction, high valuation concerns spreading
Fed may raise 25bp again in December, 10-year US Treasury near 5%
NAND is cyclical, high gross margin unsustainable indefinitely
Volatility before and after split, perpetual contract adjustments carry liquidity risk
Consumer demand still weak
Key levels
Resistance above: 950-980 → 1000-1050 → 1100+
Support below: 900-920 (short term) → 850-880 (strong) → 800-820 (key demand zone)
Trading strategy
Short-term players:
Light long positions at 900-920 on pullback, stop loss 870-880, target 950-980, add positions if above 950 aiming for 1000-1050. Keep leverage under 5x. Reduce leverage or close positions around the split (Nov 19-20) to avoid liquidity shocks from contract adjustments.
Swing traders:
Enter long after breakout and hold above 950-980, stop loss below 930, target 1050-1100. If rebound meets resistance at 980-1000 and falls back, light short positions with stop loss 1050, target 900-850.
Long-term believers:
Build positions gradually below 850 in spot stock or low-leverage perpetual contracts. AI storage long-term shortage is a structural theme, SNDK is a pure play. Post-split corresponds to higher valuation, target pre-split range 1300-1500, but patience needed for macro easing.
SNDK now is like NVIDIA at the end of 2022—
99% thought "AI bubble burst, chip stocks are done," but NVIDIA went from 108 to over 1000.
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