Top analyst: SanDisk set to rebound by 40%

Andrew Harrer | Bloomberg | Getty Images

With SanDisk down 45 percent for the year, the flash memory maker is finally undervalued, according to a top-ranked Wall Street analyst, especially after a significant investment into the industry by an influential Chinese investment fund.

Joseph Moore of Morgan Stanley upgraded SanDisk to "overweight" from "equal-weight" in a note sent to clients Thursday morning.

He presciently downgraded SanDisk in June. The shares are down 18 percent since that report.

Moore's picks average an 11 percent one-year return, and he is ranked in the top 10 percent of all Wall Street analysts, according to TipRanks.com.

Here's why he likes SanDisk now.