Here's Why These 3 Storage Stocks Are Worth Your Attention Right Now

The storage devices industry is experiencing a major renaissance, driven by accelerating AI adoption, hyperscaler expansion and enterprise cloud migration. If you’re looking to build a portfolio position in this space, here’s a quick rundown of why the sector deserves your attention—plus three compelling picks.

The Perfect Storm: Why Storage Stocks Are Heating Up

Demand for data storage solutions has never been more robust. AI workloads, edge computing infrastructure and cloud-native applications are pushing companies to upgrade their storage architectures. Hyperscalers are flooding the market with purchase orders for high-capacity hard disk drives (HDDs) and enterprise solid-state drives (SSDs), creating a multi-year tailwind for storage manufacturers.

Consider this: traditional HDDs remain the backbone of global data centers, providing reliable and cost-efficient mass storage at scale. Meanwhile, cyberattacks are escalating, driving parallel demand for secure storage solutions with end-to-end encryption. The convergence of these trends has positioned the storage devices industry for sustained growth.

What’s Reshaping the Storage Industry Landscape?

AI is rewriting the playbook. Machine learning workloads demand high-speed, high-capacity and low-latency storage—something traditional architectures can’t deliver. This is accelerating the transition toward NVMe-based SSDs (PCIe Gen 4/5/6), object storage for unstructured data, and next-gen solutions like QLC NAND SSDs for AI data lakes.

Cloud storage innovation continues apace. Industry players are pivoting from one-time hardware sales to recurring, usage-based revenue models. Kubernetes storage is gaining adoption for its agility and scalability. Meanwhile, edge computing is reducing latency while improving resource flexibility.

PC demand is bouncing back. Global PC shipments surged 8.2% year-over-year in Q3 2025, buoyed by Windows 10 end-of-support upgrades and growing AI PC adoption (expected to hit 31% of shipments in 2025 vs. 15% in 2024). However, macroeconomic headwinds—tariffs, trade tensions and cautious consumer spending—remain concerns.

The Numbers: Why This Industry Ranks at the Top

The Zacks Computer-Storage Devices industry carries a top-tier ranking in the broader tech sector, placing it in the top 7% of 243 tracked industries. Over the past year, the industry has surged 57.7%, comfortably outpacing the S&P 500’s 14.7% gain—though it’s lagged the broader tech sector’s 21.1% rise.

On valuation, the industry looks attractive. Trading at a forward 12-month P/E of 18.66X, it’s well below both the S&P 500 (23.35X) and the tech sector (28.15X). This pricing disconnect suggests room for upside as growth accelerates.

Your Storage Stocks List: 3 Names to Consider

Western Digital (WDC) remains the heavyweight player in enterprise storage. The San Jose-based manufacturer is riding a wave of AI-driven demand at hyperscalers. Its ePMR and UltraSMR drives—reaching up to 32TB capacity—have shipped over 2.2 million units in the September quarter alone. The key insight? All seven of its major customers have locked in purchase orders through mid-2026, with some extending through year-end and one securing supply through 2027. Management guides Q2 revenues to $2.9B (±$100M), up 20% year-over-year. The stock has exploded 166.1% over the past year. WDC’s Zacks rank sits at #1, and the consensus bottom-line estimate for fiscal 2026 stands at $7.63.

Sandisk (SNDK) operates as a pure-play on flash memory after Western Digital’s 2024 business split. Demand for NAND products is outpacing supply, a dynamic that’s expected to persist through 2026 and beyond. In the last quarter, data center revenues jumped 26% sequentially, fueled by hyperscaler and OEM demand. Management expects data center investments to exceed $1 trillion by 2030, an implicit demand signal for Sandisk’s SSD portfolio. Q1 fiscal 2026 revenues came in at $2.3B, up 23% year-over-year—well ahead of guidance. Adjusted free cash flow hit $448M. For Q2, the company guided to $2.55B–$2.65B in revenues with mid-single-digit bit growth and double-digit pricing power. SNDK has gained a stunning 315.3% over the past year and carries a #1 Zacks rank. The fiscal 2026 consensus bottom line is pegged at $12.59.

Teradata (TDC) has evolved into a leading multi-cloud analytics platform provider, positioning itself to capture AI and hybrid cloud adoption trends. Its cloud business showed momentum with public cloud ARR up 11% year-over-year to $633M and a cloud net expansion rate of 109%. The company reconfirmed full-year 2025 guidance and tightened free cash flow guidance to the high end of its prior range ($260M–$280M), signaling operational strength. TDC sports a #1 Zacks rank, though the stock has declined 8.1% over the past year. The 2025 consensus bottom line stands at $2.40.

The Verdict

Finding the right storage stocks list requires balancing growth catalysts with valuation discipline. Western Digital and Sandisk offer more explosive near-term upside given AI tailwinds and supply-demand dynamics. Teradata provides a more measured play on enterprise software-defined storage trends. All three carry strong industry tailwinds, reasonable valuations relative to the broader market, and visible revenue visibility extending well into 2026.