Micron Stock Surges on Unprecedented AI Demand and Sold-Out Capacity

Micron Technology is currently delivering one of the most remarkable performances in the semiconductor industry. Its shares, having appreciated by approximately 240% year-to-date, rank among 2025’s top equity performers. This explosive growth is fueled by skyrocketing demand for AI memory chips and production capacity that is already fully booked for the entire coming year. However, a notable divergence is emerging: while institutional investors are aggressively building positions, company insiders are engaging in significant sales.

Unmatched Pricing Power from AI Chip Scarcity

The core driver of Micron’s current trajectory is a severe shortage of high-performance memory for artificial intelligence applications. CEO Sanjay Mehrotra confirmed that the company’s entire production of High Bandwidth Memory (HBM) for calendar year 2026 is already completely sold out. Supply is expected to remain “significantly below demand” for the foreseeable future.

This supply-demand imbalance grants Micron substantial pricing authority. Industry data indicates DRAM prices surged 50% last quarter, with a further 40% increase anticipated for the current period. Such pricing dynamics flow directly to the bottom line, providing a clear rationale for the company’s upgraded profit forecasts.

Stellar Quarterly Results Shatter Forecasts

The company’s financial report for the first quarter of fiscal 2026 surpassed even the most optimistic projections. Revenue reached $13.64 billion, decisively beating expectations of $12.62 billion and representing a 57% increase from the prior year. The earnings performance was even more striking, with EPS coming in at $4.78 against a forecast of $3.77.

Key financial metrics from the report include:
* Q1 Revenue: $13.64 billion (Expected: $12.62 billion)
* Q1 EPS: $4.78 (Expected: $3.77)
* Q2 EPS Guidance: $8.22 to $8.62
* HBM Revenue (Q4 FY2025): $2 billion

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

Perhaps most telling is management’s guidance for the ongoing second quarter, projecting earnings per share between $8.22 and $8.62. This indicates a powerful continuation of the profit acceleration trend.

Institutional Accumulation Contrasts with Insider Selling

Professional investment firms are markedly increasing their stakes. Matthews International Capital Management raised its holding by 14.2% to 36,344 shares. Shaker Investments boosted its position by 38.4%, while Worth Asset Management initiated a new stake valued at approximately $2.05 million. Collectively, institutional investors now hold about 80.84% of the company’s shares.

This activity stands in contrast to transactions by corporate insiders. Executive Vice President April Arnzen recently sold 15,000 shares for roughly $4.16 million. Following a quadrupling of the share price, such profit-taking is not atypical, though market participants are monitoring these signals closely.

Revised Price Targets Reflect Secured Future Revenue

The stock’s technical posture remains strong, with its price trading well above key moving averages at $235 (50-day) and $262 (8-day). In response to the robust earnings, analysts have revised their price targets upward. Cantor Fitzgerald now sees the stock reaching $350, while Deutsche Bank has set a target of $300. Both firms cite the sold-out HBM production, which virtually secures revenue for 2026, as a primary justification.

The fully booked 2026 capacity and aggressive institutional buying continue to support the bullish trend. Even though the valuation appears ambitious at a trailing P/E ratio of approximately 27, these fundamental drivers provide a solid foundation for the current momentum.