Western Digital Corporation (commonly referred to as Western Digital or WD) is an Americancomputer data storage company and one of the largest computer hard disk drive manufacturers in the world, along with Seagate Technology. Western Digital Corporation has a long history in the electronics industry as an integrated circuit maker and a storage products company. It rapidly became a speciality semiconductor maker, with start-up capital provided by several individual investors and industrial giant Emerson Electric Company. Around July 1971, it adopted its current name and soon introduced its first product, the WD1402A UART. The FD1771 and its kin were WDC's first entry into the data storage industry; by the early 1980s, they were making hard disk drive controllers, and in 1983, they won the contract to provide IBM with controllers for the PC/AT. That controller, the WD1003, became the basis of the ATA interface (which WDC developed along with Compaq and Control Data Corporation's MPI division, now owned by Seagate Technology), starting in 1986. Throughout most of the 1980s, the family of controllers based on the WD1003 provided the bulk of WDC's revenues and profits, and for a time generated enormous corporate growth. 1) Financial analysisFirst of all, Western Digital Corporation attracted by its undervalued because P/E index is only 11, while the industry average is 18. The price to sales ratio is also better than the industry average of 50% and is 1.0. Long-term liabilities are also small and account for only 20% of the equity. Despite the drop in the margin the past two years, the net margin is still little more than the average for the sector and is 10.5%. Another joyful thing are dividends of 3.24% and is continuously growing since the beginning of payments in 2012. Problematic element of the database is the revenue, or to be more precise it is a negative trend to decrease. However, if you compare WDC with its main competitor Seagate company (they together now control roughly 85% of the worldwide HDD market after years of high-level consolidation saw both companies acquire large competitors), it becomes clear that things Western Digital are not as bad as that of its main competitor. WD at least increasing its share of the market for many years. Moreover, Seagate's drop in revenue is 26% of the peak value in 2013, compared to 17 percent WDC's revenue drop. Another argument for is a good business diversification tendency of WDC. Since 2011, the company increased its non-PC share of total shipments from 27% to 38%. 2) Market conditions As mentioned WDC's core business is data storage and now come the new paradigm shift. HDD will become thing of the past in the near future as well as the left floppies and CDs. Many analysts agree that the SSD market will grow annually by about 20%. And even if in PC SSD replace HDD some time later, in the mobile devices it may happen much faster. To increase its market share in SSDs, Western Digital bought Hitachi's hard drive business, SSD manufacturer STEC, enterprise flash storage company Virident Systems, storage optimization software developer VeloBit, and flash storage array maker Skyera. In October, it agreed to buy flash storage giant SanDisk (NASDAQ:SNDK) for $19 billion. According to Kitguru's market share numbers, Western Digital now is the second largest player after Samsung. This summer Western Digital's enterprise SSD revenue climbed nearly 50% annually. Those numbers will likely rise much higher after the SanDisk deal closing. On October 21, 2015, WDC announced that it would be acquiring SanDisk Corporation for a combination of cash and stock. The offer valued SanDisk common stock at $86.50 per share or a total equity value of approximately $19 billion, based on the weighted average price of WDC stock immediately prior to the announcement. Thus SanDisk was evaluated based P/E of about 30, while the WDC itself has a P/E 11. Many believe that the purchase cost is too expensive. In part, one can agree with this opinion, the company has become less attractive in the short term. But the upward trend of SSD is obvious and WD purchase secured a good share of the market, which will remain an industry leader, it is impossible to state with certainty about Seagate Technology. Following the full integration of SanDisk, which is expected to take about one and a half years, Western Digital will be able to show very good growth in revenues for shure. 3) News background The enterprise PCIe market is expected to witness significant expansion in the next three years or so with the introduction of NVMe (non-volatile memory express) infrastructure. Samsung has already launched NVMe PCIe SSDs earlier this year, and SanDisk is planning to enter the market in mid-2016, the company said. Although SanDisk will not get the first-mover advantage here, it will certainly emerge as a strong player in the NVMe space with its array of enterprise flash hardware and software solutions.Among SanDisk's current products in enterprise SSDs, Fusion-io product has real chance to boost revenue growth. The new product, which is a combination of NAND flash and VSL (virtual storage layer) data access acceleration software, has the potential to deliver 4x performance at ~60% lower cost, compared to the company's earlier version of the product. 4) Technical analysis First of all stochastically paper is very oversold, and soon will be a correction of about $ 2-3 a minimum. The current price level is very close to the critical level of resistance, is the last line of defense of the uptrend, as is 50% of the maximum price. Also, $ 60 is a resistance level, formed in 2013, formed in 2013, when the paper is "tried" twice. Thus, we have a lot of technical factors behind the upward movement in the short term. 5) Conclusion SanDisk's asquisition opened SSD promising market to Western Digital Corporation, which undoubtedly will be the basis of data storage industry in future. Furthermore, new products could resume growth in revenues and bring additional $ 1-1.2B in 2016 Recommendation: BUY. The growth potential of around 120% in the next 3-5 years.