A Western Digital (WDC) Investor’s Losses Prompt Jim Cramer to Bring Up Micron (MU)

During the October 7 episode of Mad Money, a caller said they had been averaging down on Western Digital Corporation (NASDAQ: WDC ) but remained significantly underwater. They asked whether to wait for a recovery or sell. Jim Cramer replied:

Well, okay, Western Digital's up 135% for the year. So, when you see that, you say to yourself, "Wow, I mean, like, either I missed it, or easy money's been made." But the way I look at Western Digital is: it's not as good as Micron. Micron's much cheaper. We know Micron really well here. We like it a lot. We think it could go much higher. I'm a swapper of Western Digital, which I did at one point own almost 5% of... That's when I was able to own stocks... It looks really good. But Western Digital is not as good as Micron.

Cramer's preference does not mean Western Digital lacks bullish backing. Both companies appeared in a screen of Reddit-trending stocks with substantial analyst-implied upside, although they occupied different positions in the ranking.

Two Different Ways to Benefit From Growing Data Demand

Western Digital Corporation (NASDAQ:WDC) focuses on hard disk drives following the separation of its flash business into Sandisk. Micron Technology, Inc. (NASDAQ: MU ) manufactures semiconductor memory and storage products. Both serve growing data requirements, but their products and manufacturing economics differ.

Western Digital's fiscal fourth-quarter revenue increased 44% year-over-year to $3.75 billion. Adjusted earnings reached $3.56 per share, while free cash flow was approximately $1.28 billion. Management projected fiscal first-quarter revenue growth of 42% to 49%, highlighting that the company's operating outlook remained strong despite the caller's disappointing investment experience. Western Digital's rally also placed it near the top of a three-year ranking of AI-linked stock returns . The accompanying coverage highlighted a supply imbalance that could help explain more than just rising sales.

Micron reported fiscal fourth-quarter 2024 revenue of approximately $54.23 billion, compared with $11.32 billion a year earlier, and adjusted earnings of $33.42 per share. Its customer agreements also provide greater visibility. Management reported approximately $150 billion of remaining performance obligations under agreements containing committed volumes and defined pricing arrangements. These commitments extend beyond a single quarter and should not be confused with immediate revenue. Those agreements are central to Cramer's argument that Micron deserves a different investment lens . How far they change its exposure to the memory cycle remains the more consequential question.