Why Sandisk Stock Sank Today

The 2026 midterm results are in, and the Democrats won in a landslide. So what does this mean for Sandisk (SNDK -7.29%) stock? Apparently, nothing good.

Shares of the NAND flash memory giant sold off 8.6% through 11:50 a.m. ET Wednesday as nervous investors wonder what a sea change in government might mean for artificial intelligence data centers — and for Sandisk’s sales of memory to outfit them.

Image source: Getty Images.

Bad news for artificial intelligence?

StreetInsider.com is blaming the midterm election results for “renewed selling pressure” on AI and memory chip stocks. As the thinking goes, “potential tighter oversight of AI infrastructure and data-center expansion” would be bad news for memory sales growth, and a Democratic Congress is seen as more likely to pass such regulations than the former Republican-led Congress was. And some Wall Street analysts agree. As the election approached, Fox Advisors downgraded Sandisk stock to equalweight, and Wells Fargo cut its price target on the stock.

Now, it’s looking like the U.S. Senate will number 54 Democrat votes to just 44 Republicans, and the House of Representatives is tilting blue 228-139 (with 68 seats unconfirmed).

SNDK – Sandisk

$1,044.36-$82.16 (-7.29%)

NASDAQ · As of 12:02 PM ET 11/04/26

What’s next for Sandisk stock

But is the news really as bad as that? Maybe a Democrat-controlled Congress will regulate AI more strictly, maybe not. Either way, though, Citigroup is forecasting continued undersupply of memory chips in 2027.

2027 will see memory companies increase production by 22%, says Citi — but demand will grow by 26%, maintaining a supply-demand imbalance that should spur sales and keep memory prices high. So long as memory companies like Sandisk don’t overplay their hand and seek “excessive price increases” that force buyers to find new ways to do AI with less memory, the memory chip rally should continue — and Sandisk stock at 5x forward earnings looks really quite cheap.

Wells Fargo is an advertising partner of Motley Fool Money. Citigroup is an advertising partner of Motley Fool Money. Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Source: www.fool.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.