NEW YORK (TheStreet) -- The shares of flash memory product maker SanDisk are jumping after Goldman Sachs added the stock to its Conviction List in a note to investors earlier today. WHAT'S NEW: The growth in the supply of NAND, a prevalent form of flash memory, should be "reasonable" in the near-term, wrote Goldman analyst Mark Delaney after analyzing NAND orders made in the second half of last year. Meanwhile, Apple's iPhone 6 has caused other handset makers to increase the amount of NAND they use in their devices, Delaney believes. The declines in the prices of SanDisk's products should moderate later this year and its gross margins should rise by four percentage points this year as it cuts costs and sells a more favorable mix of products, the analyst predicted. Although investors are worried that the advent of 3D NAND will cause overall NAND supplies to rise, the increase should be reasonable, partly because 3D NAND is more expensive to make, according to Delaney's analysis. Meanwhile, SanDisk's new all-flash scale-out storage system will enable it to benefit from a sizable growth market with high margins and could enhance investors' longer term view of the stock, wrote Delaney, who raised his price target on the stock to $106 from $100. ANOTHER TO WATCH: Micron is another prominent flash memory product maker. PRICE ACTION: In mid-morning trading, SanDisk rallied 5% to $84.19, while Micron shares rose fractionally to $27.72. Reporting by Larry Ramer.
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