J.P. Morgan Upgrading Western Digital

J.P. Morgan Chase & Co. is upgrading shares of Western Digital

to Overweight from Neutral, and the price target is going to $50 from $42. In a note to clients, J.P. Morgan Chase & Co. writes, "We are upgrading WD to Overweight from Neutral. In a separate industry report, we provide plenty of details, as our call is based on industry fundamentals reaching a positive inflection point. We expect both WD and Seagate to benefit from favorable pricing conditions and bottoming unit trend-lines. The combination of these factors stands to drive upward pressures to consensus numbers beyond the near term. We expect gross and operating margin profiles to exhibit 200 basis point or greater improvements in the next 12-18 months. The flow-through effects in our blended price target analysis result in WD having 34% upside potential when comparing our Dec-12 price target of $50 to the current stock price." Shares of WDC gained 61 cents yesterday to close at $37.39, a gain of 1.66%.