8 Most Undervalued Growth Stocks To Buy According To Wall Street Analysts

5. Western Digital Corporation (NASDAQ:WDC)

Forward P/E: 8.41

Earnings Growth: 4045.00%

Number of Hedge Fund Holders: 80

Analyst Upside Potential: 35.64%

Western Digital Corporation (NASDAQ:WDC) is a technology company that specializes in data storage technologies. Its core products include Hard Disk Drives, Solid State Drives (SSD), and Flash Storage devices. These storage devices are used to store large amounts of data quickly in electronic devices and servers. Apart from hard data storage, the company is also involved in cloud storage solutions that allow users to store and access data online through the cloud.

The Western Digital Corporation (NASDAQ:WDC) stands at an indispensable position in the growing memory storage demand for the data center and artificial intelligence industry. The company has been developing its portfolio and building its operational capacity strategically to be ready to meet the growing demand for its products.

It recently announced its fiscal fourth quarter 2024 results, which indicated that the company has capitalized on both hard drive and cloud storage segments. The overall revenue for the quarter stood at $3.76 billion, up 9% subsequently, whereas its Cloud revenue grew by 21% during the same time. The quarter was marked by a 3% increase in client revenue indicating new wins in the segment. As a result of this robust performance the revenue for the year came in at $13 billion.

Management expects its fiscal first quarter 2025 revenue to be between $4 to $4.2 billion indicating a significant increase from the recent quarter.

Western Digital Corporation (NASDAQ:WDC) is also cheap at current levels and ranks 6th on our list of most undervalued growth stocks to buy according to Wall Street analysts. It is trading at only 8.4 times its forward earnings. Moreover, analysts are expecting its earnings to grow by more than 4000% during the year making it a hard-to-miss investment opportunity for risk-tolerant investors.

Parnassus Mid Cap Fund stated the following regarding Western Digital Corporation (NASDAQ:WDC) in its Q2 2024 investor letter:

“We re-initiated a position in Western Digital Corporation (NASDAQ:WDC), a manufacturer of memory semiconductor chips and hard disk drives, as we believe earnings expectations are far too low. Semiconductors have been another of our most-alpha-generative industries, thanks to the industry’s secular tailwinds and our in-house expertise. Western Digital stands to benefit from the rapid growth of memory-hungry AI applications. The valuation for Western Digital was low relative to its peers, giving us a way to participate in AI at a reasonable valuation.”