Morgan Stanley has singled out Western Digital as a major winner in the rapidly expanding market for data storage hardware, driven by insatiable demand from AI workloads and cloud computing. The firm raised its price target on WDC from $488 to $650 while maintaining an Overweight rating, a vote of confidence that sent the stock climbing.
The core thesis is straightforward: hard disk drives are experiencing a demand renaissance, and Western Digital is one of only two companies on the planet that makes them at scale.
The supply-demand math favoring HDDs
Morgan Stanley’s analysts project annual HDD demand growth of 40-50%, a pace that meaningfully outstrips supply growth, which they estimate at 30-35%.
The demand surge stems from hyperscale data centers and cloud service providers that need massive, cost-effective storage for the tidal wave of data generated by AI applications. While SSDs grab most of the headlines for speed, HDDs remain the workhorse for bulk data retention.
