Renowned short-selling firm Citron: Currently shorting SanDisk, claiming that the current boom in the storage chip market is a "supply illusion"

BlockBeats News, February 24 — Well-known short-selling firm Citron Research released a report stating that SanDisk’s market pricing is too high, similar to Nvidia, but the two are different: Nvidia has a moat, while SanDisk sells commoditized products. Western Digital has recently significantly reduced its holdings, now below market price by 25%, indicating that seasoned investors foresee the memory cycle reaching its peak soon. Historical data shows that cyclical peaks in the memory market occurred in 2008, 2012, and 2018, and SanDisk is no exception.

Samsung has prioritized market share over profit margins for the past 30 years. This time, it is directly targeting SanDisk’s core customers with high-end SSD products and has promised not to sell products below a 50% gross margin. SanDisk’s current supply tightness is just a temporary capacity bottleneck, merely a “shortage illusion” that could disappear at any moment during an earnings call.

Citron emphasizes that shorting SanDisk stock is a strategy to preemptively position for a cycle adjustment. When the memory market returns to normal, SanDisk’s stock price may have already fallen significantly.