Ahead Of The Bell: SanDisk Gains After 3Q Results

NEW YORK (AP) — Shares of SanDisk Corp. rose in premarket trading Wednesday after reporting that sales grew 14 percent in the third quarter, helping the flash memory card maker swing to a profit.

The Milpitas, Calif., company said late Tuesday that stronger demand for its products and higher prices drove sales upward, posting a profit of 75 cents per share, excluding charges, compared with a loss of 74 cents per share a year earlier. The results eclipsed Wall Street's forecast for a profit of 26 cents per share.

Shares gained $1.42, or 6.6 percent, to $22.90 in premarket activity Wednesday.

Some of that revenue growth was due to retail outlets restocking inventories, so it will likely slow, said Deutsche Bank analyst Bob Gujavarty in a note to investors, but "benign" prices and ongoing cost cuts will likely grow profit margins.

The analyst, who has a "Buy" rating on the shares, raised his price target to $32.

The company said it believes it maintained market share despite raising prices, while adding new customers in its non-retail division, Gujavarty said.