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    WDC · NMS · Technology

    Western Digital Corporation

    Also onConsensus Drift

    Implied value per share

    USD 169.45

    Market price

    USD 338.59

    Implied upside

    -50.0%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2026-06-30

    Current EV/EBITDA of 25.4x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.

    Value Per Share

    Perpetuity growth
    USD 169.45-50.0%
    Exit multiple
    USD 438.88+29.6%
    Market price
    USD 338.59

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn6bn11bnFY27FY28FY29FY30FY31FY32FY33FY34FY35FY36
    Nominal FCFFDiscounted to todayUSD
    LineFY27FY28FY29FY30FY31FY32FY33FY34FY35FY36CAGR
    RevenueUSD 19.4bnUSD 27.2bnUSD 37.0bnUSD 48.4bnUSD 61.1bnUSD 74.3bnUSD 86.7bnUSD 97.1bnUSD 104.1bnUSD 106.7bn+20.9%
    EBITUSD 2.6bnUSD 3.6bnUSD 4.9bnUSD 6.4bnUSD 8.1bnUSD 9.9bnUSD 11.5bnUSD 12.9bnUSD 13.8bnUSD 14.2bn+20.9%
    NOPATUSD 2.4bnUSD 3.4bnUSD 4.7bnUSD 6.1bnUSD 7.7bnUSD 9.4bnUSD 10.9bnUSD 12.3bnUSD 13.1bnUSD 13.5bn+20.9%
    Add depreciation & amortisationUSD 1.4bnUSD 2.0bnUSD 2.8bnUSD 3.6bnUSD 4.6bnUSD 5.5bnUSD 6.5bnUSD 7.3bnUSD 7.8bnUSD 8.0bn+20.9%
    Less capital expenditureUSD -1.4bnUSD -2.0bnUSD -2.8bnUSD -3.7bnUSD -4.9bnUSD -6.1bnUSD -7.3bnUSD -8.3bnUSD -9.2bnUSD -9.6bn+24.1%
    Capex, % of revenue7.1%7.3%7.5%7.7%8.0%8.2%8.4%8.6%8.8%9.0%-
    Less increase in working capitalUSD -1.3bnUSD -1.6bnUSD -2.0bnUSD -2.3bnUSD -2.6bnUSD -2.7bnUSD -2.5bnUSD -2.1bnUSD -1.4bnUSD -528.9m-9.6%
    Free cashflow to firmUSD 1.2bnUSD 1.9bnUSD 2.7bnUSD 3.7bnUSD 4.8bnUSD 6.2bnUSD 7.6bnUSD 9.0bnUSD 10.3bnUSD 11.3bn+28.2%
    Discount factor0.94130.83390.73880.65460.57990.51380.45520.40330.35730.3166-
    Present valueUSD 1.1bnUSD 1.6bnUSD 2.0bnUSD 2.4bnUSD 2.8bnUSD 3.2bnUSD 3.5bnUSD 3.6bnUSD 3.7bnUSD 3.6bn-
    Present Value Of The ForecastUSD 27.4bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.900Reported 2.344, pulled toward 1.0 (Blume)
    Cost of equity12.93%Risk-free + beta x equity risk premium
    Cost of debt5.73%Interest expense / average total debt
    Market capitalisationUSD 126.7bn99.2% of capital
    Total debtUSD 1.1bn0.8% of capital, book value as a proxy
    Tax rate4.9%Effective, capped at statutory
    WACC12.87%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 169.45

    57% of EV

    Forecast FCFF, final year
    USD 11.3bn
    Capex at depreciation, working capital in reinvestment
    USD 13.5bn
    Less reinvestment at g/ROIC (12.4% of NOPAT)
    USD -1.7bn
    Capitalised
    USD 11.8bn
    ROIC (reported)
    20.2%
    Terminal value, undiscounted
    USD 116.7bn
    Terminal value, discounted
    USD 36.9bn
    Enterprise value
    USD 64.4bn
    Less net debt
    USD -527.0m
    Equity value
    USD 64.9bn

    Exit at 20.0x EBITDA

    Value per shareUSD 438.88

    84% of EV

    Terminal value, undiscounted
    USD 442.7bn
    Terminal value, discounted
    USD 140.1bn
    Enterprise value
    USD 167.6bn
    Less net debt
    USD -527.0m
    Equity value
    USD 168.1bn

    Spread between methods: 89%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    10.87%216.70219.44222.66226.47230.96
    11.87%189.80191.27193.04195.15197.66
    12.87%167.96168.62169.45170.50171.78
    13.87%149.94150.06150.29150.65151.15
    14.87%134.86134.63134.46134.37134.37

    Outlined: this model. Green text: above today's price of 338.59. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year27.4%23.5%33.8%
    EBIT margin35.6%13.3%24.7%
    Discount rate-12.9%8.4%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.