Key Takeaways Micron’s stock price retreated approximately 2% during Monday’s premarket session, settling around $1,056 per share. The downturn mirrored broader semiconductor sector weakness
Shares of Micron Technology experienced a downturn Monday morning, retreating roughly 2% to approximately $1,056. The weakness reflected broader semiconductor sector headwinds stemming from upward pressure on bond yields.
Market sentiment took an additional hit following a weekend announcement from OpenAI. The artificial intelligence company behind ChatGPT revealed plans to temporarily suspend training activities for its most advanced AI models, citing safety considerations. This development rattled investors already apprehensive about potential deceleration in AI infrastructure spending.
The memory chipmaker has delivered extraordinary returns for investors recently. With gains exceeding 600% over the past year, shares have become particularly sensitive to any signals suggesting a potential slowdown in AI-related demand.
All eyes turn to Wednesday when the company unveils its fiscal fourth-quarter performance. Consensus estimates call for revenue to reach $51.14 billion, representing a nearly fivefold increase.
Profit per share is anticipated to expand more than ten times compared to the same period last year. Such results would represent one of the most impressive quarters in Micron‘s corporate history.
Remarkably, despite the dramatic share price appreciation, the stock trades at a forward P/E multiple of merely 6.7 times, based on FactSet data. This valuation doesn’t account for potential share repurchases, which could commence as early as next month.
Daniel Morgan, serving as senior portfolio manager at Synovus Trust, maintains an optimistic view on the memory chip landscape. He emphasized that DRAM and NAND supply constraints are projected to persist through fiscal 2027, with meaningful capacity additions not materializing until fiscal 2028.
Morgan highlighted that the company currently supplies less than 50% of the volume its data center clients are seeking. This supply-demand imbalance underscores how production capacity continues to trail market requirements.
Baird elevated its price objective on Micron from $1,280 to $1,520, while maintaining an Underperform rating. The investment bank pointed to accelerating agentic AI adoption, decelerating industry-wide DRAM bit expansion for 2027, and improving profitability expectations for high-bandwidth memory in the coming year.
The firm anticipates roughly 40% growth in AI CPU units across the industry during 2027. Baird has also revised upward its DRAM pricing projections for the latter half of 2026.
Industry-wide DRAM bit growth is now forecast to exceed 30% in 2026 before moderating to 20% in 2027, incorporating HBM volumes. High-bandwidth memory specifically is projected to expand approximately 60% annually, with supply constraints likely extending into 2027.
Server unit expansion is also expected to accelerate, climbing from 18-19% in the current year to 20-22% in the following year. Meanwhile, Chinese competitor CXMT’s aggressive 45% bit growth this year is anticipated to decelerate significantly in 2027.
Additional financial institutions continue voicing confidence. JPMorgan forecasts that Micron’s revenue, gross margin, and earnings per share will surpass consensus projections of $51.4 billion, 86.2%, and $31.73 per share, respectively.
UBS reaffirmed its Buy recommendation, highlighting an expanding differential between DRAM supply availability and market demand. The institution projects server and storage SSD bit demand could potentially exceed 100% year-over-year growth by 2027.
Wells Fargo maintained its Overweight stance while boosting its price target to $1,400. The bank simultaneously increased its revenue and profit forecasts for fiscal years 2027 and 2028.
Stifel reaffirmed its Buy rating as well, anticipating that Micron’s actual results and forward guidance will exceed market expectations. The firm cautioned that ongoing supply limitations might temper upside potential compared to more optimistic investor scenarios.
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