SNDK at $855, are you bottom-fishing or catching a falling knife?
Earnings blew up, revenue soared 378% year-over-year, gross margin 85%, PE only 8x—but it plunged 36% in 6 days, halving twice from $2374, with a 24-hour swing over 20%. Is this the first domino of the AI bubble bursting, or the fattest mispricing of 2026?
First, look at the surface: all good news was treated as bad.
On October 29, earnings came out: revenue $11.03 billion, up 23% quarter-over-quarter, 378% year-over-year, EPS $49.51 beating expectations, gross margin 85.1%. Data center revenue $4.8 billion, up 61% quarter-over-quarter. The company also announced an 8-for-1 stock split plus a $5 billion buyback.
The result? The stock price crashed from 1020 straight down to 794, dropping over 36% in 6 trading days.
This is not a fundamentals issue, it’s a sentiment issue. The candlestick chart tells you: RSI is deeply oversold, but the downward momentum hasn’t exhausted yet; 800 is the last line of defense.
First point: the better the earnings, the harder it falls—do you taste the irony?
Revenue up 378% year-over-year, gross margin 85%, free cash flow $5.7 billion in a single quarter, no debt on the books, still buying back shares. With fundamentals like this, in any normal market, the stock should hit the daily limit up.
But it fell 36%.
Why? Because the market is trading a narrative: the AI bubble is about to burst.
NVDA down, MU down, AMD down, the entire chip and storage sector collectively de-rating. SNDK is just the one being trampled. Fox Advisors downgraded rating, China’s CXMT prepayment surge triggered competition concerns—all bad news amplified, all good news ignored.
This isn’t SNDK’s problem, it’s the whole AI trade retreating. When the tide goes out, it first kills the most expensive, then the biggest gainers. SNDK is still up over 200% YTD; if not it, then who?
Second point: PE 8x, have you seen any AI core asset this cheap?
TTM PE 8-9x, even lower forward. Compared to peers: MU, NVDA, AMD, which one isn’t above 20x?
SNDK is the global core player in NAND flash + enterprise SSDs, AI data centers can’t do without it. RPO (Remaining Performance Obligations) $88.9 billion, long-term contracts locked in, revenue visibility for years is extremely high.
The market’s current valuation assumes "AI demand collapses next year."
But Omdia just raised semiconductor revenue forecasts for 2026, memory shortages continue through 2027, hyperscaler capex remains high.
You say it’s a bubble? An 8x PE bubble? Then what do you call Tesla’s 100x PE in 2021?
Third point: $800 is the lifeline, volatility will increase before the split.
Technicals: daily MA bearish alignment, price far below all key moving averages, consecutive bearish candles with volume selling. RSI deeply oversold but no clear divergence yet.
Key levels: 800-790 is the 24-hour low + IPO low area, next support 700-750.
Split record date November 9, effective after market close November 19, adjusted trading November 20. Volatility will increase before the split, leveraged players beware, 75x contracts are a meat grinder.
Trend is still down, but oversold rebounds can come anytime. Chasing shorts or bottom-fishing, both are licking blood on the knife’s edge.
Bull vs. bear, you decide:
On the bull side:
Earnings blew up, revenue +378% YoY, gross margin 85%
PE 8x, valuation at historic lows
RPO $88.9 billion, extremely high revenue visibility
$5 billion buyback + 8-for-1 stock split
Strong support at 800, RSI deeply oversold
AI storage demand structurally growing, shortage lasting through 2027
On the bear side:
36% drop in 6 days, trend unchanged
AI bubble fears spreading, sector-wide de-rating
China CXMT competition intensifying
Increased volatility before split, high contract leverage risk
Market sentiment extremely fearful, no sign of bottom yet
Key levels
Resistance above: 900-950 → 1000-1050 → 1200+
Support below: 800-790 (lifeline) → 700-750
Trading strategy
Short-term players:
Wait for daily chart to show bottom signals—long lower shadows, volume contraction and stabilization, or breakout of short-term downtrend line. If it breaks 800 with volume confirmation, light short positions can be tried, target 750-700, stop loss above 850. If rebound meets resistance at 900-950, reduce position or try longs.
Swing traders:
Add light long positions around 800 in batches, stop loss 750, target first 950-1000, then 1200+. Position size controlled at 5-10% of total capital, leverage ≤5-10x. Avoid heavy positions before split, volatility will wash you out.
Long-term believers:
Fundamentals support accumulation on dips. AI storage core asset at 8x PE, better liquidity after split, lower retail participation threshold. 2027 target revisited at 1500-2000, betting on AI cycle continuation + valuation recovery. But remember—before trend reversal, buy in batches, don’t go all in.
SNDK now is like Meta at the end of 2022—
Earnings blew up, PE single digits, everyone shouting "growth is over," yet it went from 88 to 600. $BTC$SNDK$MU
Disclaimer: OKX Orbit content is provided for informational purposes only. Learn more
