Prominent Short Seller Citron: Shorting SanDisk, Current Memory Chip Market Boom a "Supply Mirage"

BlockBeats News, February 24th - Renowned short-selling firm Citron Research released a report stating that SanDisk is overvalued in the market, similar to NVIDIA, but with a difference: NVIDIA has a moat, while SanDisk sells commoditized products. Western Digital had significantly reduced its holdings a few days ago, below market price by 25%, indicating that savvy investors foresee the memory cycle about to peak. Historical data shows that memory market cyclical peaks occurred in 2008, 2012, and 2018, and SanDisk is unlikely to be an exception.

Samsung has prioritized market share over profitability for the past 30 years, this time directly pushing high-end SSD products to SanDisk's core customers and committing not to sell products below a 50% gross margin. The current supply shortage at SanDisk is only a temporary production bottleneck, and this is just a "scarcity illusion" that could disappear at any time, possibly in one earnings conference call.

Citron emphasized that shorting SanDisk stock is a strategy to position ahead of the cyclical adjustment. By the time the memory market returns to normal, SanDisk's stock price may have already plummeted significantly.