Is Western Digital Stock’s 21% Drop A Bargain?
Western Digital (WDC) stock has fallen by 20.6% in less than a month, from $316.93 on 19th Mar, 2026 to $251.67 now (March 30th). Should you buy this dip?
Dip buying is a viable strategy for quality stocks that have a history of recovering from dips. As it turns out, WDC stock passes basic quality checks. Historically, the median return for the 12-month period following sharp dips was 26% , with median peak return reaching 51%. We define sharp dip as stock going down 20% or more, in less than 30 day period.
Below, we get into details of historical dips and subsequent returns.
Historical Median Returns Post Dips
| Period | Past Median Return |
|---|---|
| 1M | 6.9% |
| 3M | 0.5% |
| 6M | 6.4% |
| 12M | 25.8% |
Historical Dip-Wise Details
WDC had 21 events since 1/1/2010 where the dip threshold of -20% within 30 days was triggered
- 51% median peak return within 1 year of dip event
- 352 days is the median time to peak return after a dip event
- -27% median max drawdown within 1 year of dip event
| 30 Day Dip | WDC Subsequent Performance | |||||||
|---|---|---|---|---|---|---|---|---|
| Date | WDC | SPY | 1Y | Peak Return |
Max Drop |
# Days to Peak |
||
| Median | 26% | 51% | -27% | 352 | ||||
| 3312025 | -21% | -8% | 525% | 687% | -24% | 353 | ||
| 8012024 | -25% | -1% | 63% | 69% | -33% | 364 | ||
| 3132023 | -21% | -5% | 77% | 83% | -9% | 359 | ||
| 12272022 | -22% | -4% | 70% | 69% | -3% | 364 | ||
| 9142022 | -21% | -3% | 14% | 20% | -21% | 352 | ||
| 6162022 | -26% | -15% | -16% | 9% | -35% | 57 | ||
| 2232022 | -21% | -9% | -25% | 21% | -42% | 70 | ||
| 8212020 | -20% | 7% | 85% | 129% | 0% | 287 | ||
| 2272020 | -20% | -9% | 26% | 30% | -47% | 363 | ||
| 12092019 | -22% | 4% | 11% | 49% | -39% | 45 | ||
| 5282019 | -24% | -3% | 21% | 84% | -24% | 240 | ||
| 10262018 | -22% | -8% | 49% | 52% | -21% | 321 | ||
| 9042018 | -21% | 3% | 8% | 3% | -41% | 365 | ||
| 4272018 | -20% | -3% | -34% | 9% | -56% | 26 | ||
| 5042016 | -22% | 0% | 133% | 133% | -11% | 364 | ||
| 1142016 | -22% | -8% | 50% | 51% | -27% | 361 | ||
| 11112015 | -21% | 8% | -6% | 3% | -42% | 23 | ||
| 7102015 | -22% | -2% | -33% | 12% | -53% | 91 | ||
| 5312012 | -24% | -5% | 106% | 107% | -8% | 364 | ||
| 8182011 | -28% | -15% | 63% | 63% | -12% | 365 | ||
| 6072010 | -25% | -13% | 3% | 23% | -29% | 318 | ||
Western Digital Passes Basic Financial Quality Checks
Revenue growth, profitability, cash flow, and balance sheet strength need to be evaluated to reduce the risk of a dip being the sign of a deteriorating business situation.
| Quality Metrics | Value | Quality Check |
|---|---|---|
| Revenue Growth (LTM) | 25.2% | Pass |
| Revenue Growth (3-Yr Avg) | 7.5% | Pass |
| Operating Cash Flow Margin (LTM) | 24.7% | Pass |
| Leverage (see below) | – | Pass |
| => Interest Coverage Ratio | 13.7 | |
| => Cash To Interest Expense Ratio | 14.5 |
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