Shares of memory chip manufacturer Micron Technology Inc. (NASDAQ:MU) climbed 3.28% during Monday’s pre-market trading session after Bernstein SocGen Group raised its price target on Micron to $1,300 from $510.
The firm boosted its price target, citing stronger memory-chip pricing and higher expectations for high-bandwidth memory through 2027, according to Investing.com. The firm also boosted earnings forecasts for Samsung Electronics Co. Ltd. (OTC:SSNLF), SK Hynix Inc., projecting profits well above consensus estimates and expecting continued earnings growth to support memory-sector stocks.
Tight Supply Drives Memory Profits
As Micron’s financial results are set to be announced on Wednesday after the closing bell, more analysts weighed in on the path ahead amid skyrocketing memory prices.
According to Jack Gold, principal analyst at J.Gold Associates, the company has been increasingly focusing on high-bandwidth memory, a key technology for AI applications that offers higher profit margins than traditional dynamic random-access memory (DRAM).
Gold told MarketWatch, “It’s unlikely we’ll see any appreciable price decreases until the manufacturing catches up with the demand, which is unlikely for the next 12-18 months at least, even as Micron has announced some very large investments in building new capacity.”
Another analyst, Morningstar’s William Kerwin, told the publication that the growth of Micron has been astonishing over the past 12 months. “Tight memory supply is sending prices skyrocketing, leading to massive growth coming at nearly pure profit,” Kerwin said.
Apple Faces Soaring Component Costs
Perplexity AI CEO Aravind Srinivas, meanwhile, said Micron could eventually surpass Meta Platform Inc. (NASDAQ:META) in market value, arguing that AI’s biggest winners will be hardware providers. He believes supply-chain constraints and limited manufacturing capacity have given chipmakers significant pricing power as demand continues to exceed supply.
However, the soaring memory costs have led to unavoidable price increases for tech giants like Apple Inc. (NASDAQ:AAPL), as stated by CEO Tim Cook.
Cook warned that the company can no longer fully absorb the significant price increases from suppliers. Although Apple has not disclosed which products could be affected, Cook described the current commodity market swings as unprecedented in his 40 years in electronics supply chains. Micron stock closed 8.70% higher on Thursday amid Cook’s comments.
According to Benzinga Edge Stock Rankings, Micron has a growth score of 83.10% and a momentum rating of 99.62%, indicating strong performance in both areas. Benzinga’s screener allows you to compare Micron’s performance with its peers.
MU Price Action. On a year-to-date basis, Micron stock surged 259.52%, as per data from Benzinga Pro.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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