WDC Up 23% In A Week. Do You Buy Or Wait?

Western Digital (WDC) stock is up 22.9% in 5 trading days. Already own the stock? You might want to consider holding it. Planning to buy? Put it on your watch list. Consider the following data:

• Size: A $46 Bil company with $13 Bil in revenue currently trading at $131.31.
• Fundamentals: Last 12 month revenue growth of 39.2% and operating margin of 21.1%.
• Liquidity: Has Debt to Equity ratio of 0.1 and Cash to Assets ratio of 0.15
• Valuation: Currently trading at P/E multiple of 24.6 and P/EBIT multiple of 21.4
• Has returned (median) 59.9% within a year following sharp dips since 2010. See WDC Dip Buy Analysis.

While we like to ride the momentum if the fundamentals check out – for WDC, see Buy or Sell WDC Stock – we are wary of bull traps. Specifically, it is worth trying to answer if things get really bad, and WDC drops 20-30% to $92 levels, will we be able to hold on to the stock? What is the worst case scenario? We call it downturn resilience. Turns out, the stock has fared worse than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.

WDC stock has jumped meaningfully recently and we currently find it attractive. While this may feel like an opportunity, there is significant risk in relying on a single stock. On the other hand, there is a huge value to a broader diversified approach we take with Trefis High Quality Portfolio. Separately, consider what could long-term performance for your portfolio be if you combined 10% commodities, 10% gold, and 2% crypto with equities.

Below are the details, but before that, as a quick background: WDC provides data storage devices and solutions, including HDDs, SSDs, and flash-based embedded storage for computing and portable devices like PCs, mobile phones, and wearables.

2022 Inflation Shock

• WDC stock fell 60.9% from a high of $77.17 on 4 June 2021 to $30.21 on 28 December 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 29 May 2024
• Since then, the stock increased to a high of $131.31 on 3 October 2025 $131.31

 
2020 Covid Pandemic

• WDC stock fell 58.8% from a high of $70.93 on 23 January 2020 to $29.19 on 18 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 1 March 2021

 
2018 Correction

• WDC stock fell 67.1% from a high of $106.45 on 16 March 2018 to $35.06 on 24 December 2018 vs. a peak-to-trough decline of 19.8% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 19 September 2025

 
2008 Global Financial Crisis

• WDC stock fell 75.2% from a high of $39.98 on 5 June 2008 to $9.93 on 20 November 2008 vs. a peak-to-trough decline of 56.8% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 16 December 2009

 
Worried that WDC could fall much more? You could take a look at the Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.