Wall Street Analysts Rally Behind Micron Stock Ahead of Earnings

A significant wave of analyst optimism has swept through Wall Street regarding Micron Technology, with seven major investment banks substantially raising their price targets for the memory chip leader in a matter of days. The new forecasts, ranging from $175 to $200 per share, suggest a potential upside of up to 25% from recent trading levels. This surge in confidence arrives just before the company’s quarterly earnings report scheduled for Monday.

AI Demand Fuels Widespread Upgrades

The catalyst for this bullish sentiment is Micron’s strategic position at the heart of the artificial intelligence revolution. The company’s High-Bandwidth Memory (HBM) products and advanced DRAM solutions are considered essential components for AI data centers and machine learning applications, driving exceptional demand.

Susquehanna initiated this series of upgrades on September 17 with one of the most dramatic adjustments, increasing its price objective from $160 to $200. Analyst Mehdi Hosseini specifically highlighted the robust demand for Micron’s memory products. Wolfe Research followed on the same day, raising its target from $160 to $180.

The upward revisions continued throughout the week with Barclays elevating its target from $140 to $175, UBS moving from $155 to $185, and Citigroup increasing from $150 to $175. Wedbush matched Susquehanna’s optimistic $200 target, marking the highest projection.

Quarterly Results to Validate Expectations

All attention now turns to Micron’s financial results, which will be released after market close on Monday. The company has already proactively raised its own guidance, projecting revenue of $11.2 billion, up from a previous forecast of $10.7 billion, with a non-GAAP gross margin of 44.5%.

Should investors sell immediately? Or is it worth buying Micron?

Market experts anticipate earnings per share of $2.87, which would represent a remarkable 143% increase compared to the same period last year. Revenue projections stand at $11.11 billion, indicating growth of 43.3% year-over-year.

The most explosive growth has occurred in Micron’s data center segment, which has tripled over recent quarters. This expansion is primarily driven by cloud service providers and AI companies making substantial investments in memory-intensive infrastructure.

Cyclical Challenges Linger

Despite the prevailing enthusiasm, some experts caution that the memory chip industry remains inherently cyclical. Competitors including Samsung and SK Hynix continue to apply competitive pressure, and memory pricing historically demonstrates volatility.

Monday’s earnings release will serve as a critical test of whether the recent analyst confidence is justified or if expectations have been elevated beyond reasonable levels.