Micron Technology, Inc.

NASDAQ Global Select
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Somewhat Bullish +35

Should You Buy Micron Technology Stock Before June 24, or Is the Semiconductor Sell-Off About to Get Worse? - Yahoo Finance

📈 Micron Technology is a leading HBM supplier crucial for AI hardware, currently commanding high prices due to supply shortages.

📉 Stock price dropped 20% recently after Broadcom issued conservative forecasts for future AI sales, sparking nervousness about demand slowdowns.

🚀 Micron has begun producing new HBM4 chips with 60% more capacity than HBM3E and 20% better energy efficiency.

🤝 Nvidia plans to use Micron's HBM4 chips in its upcoming Vera Rubin GPU systems expected to ship in the second half of the year.

💰 The HBM market is valued at $35 billion and projected to nearly triple to $100 billion by 2028.

📊 Micron delivered $23.8 billion in revenue for fiscal 2026 Q2, a 196% increase from the year-ago period.

🔮 Management guidance suggests fiscal 2026 Q3 revenue reached approximately $33.5 billion, representing a 260% increase.

💵 Analysts estimate Micron could show third-quarter earnings of $18.90 per share, up 1,025% from the prior year.

📉 Current trailing P/E ratio is 40.8, slightly higher than the Nasdaq-100 technology index average of 35.2.

🔭 Wall Street forecasts earnings growth to $105.95 per share in fiscal 2027, implying a forward P/E of just 8.1.

⚠️ Earnings growth may face headwinds as suppliers race to build capacity, likely normalizing prices over the next year or two.

📉 Peak AI hardware demand could be on the horizon following Broadcom's missed revenue forecasts and potential price reductions.

🗣️ Alphabet CEO Sundar Pichai reported enterprise customers complaining about rising AI usage costs, signaling demand concerns.

💸 Uber Technologies' COO stated AI spending is becoming harder to justify after blowing through its 2026 budget in four months.

🚫 The Motley Fool Stock Advisor team did not include Micron in their current list of top 10 stocks to buy now.

Bullish Signals
  • Micron is a world-leading supplier of high-bandwidth memory (HBM), an essential component for AI hardware stacks.
  • Current HBM supply shortages give Micron significant pricing power, fueling a surge in revenue and earnings.
  • The company has successfully launched new HBM4 chips offering 60% more capacity than the previous generation.
  • Micron's entire 2026 HBM supply is already sold out, indicating strong near-term demand.
  • Fiscal 2026 Q2 revenue reached $23.8 billion, marking a massive 196% increase from the year-ago period.
  • Q3 revenue guidance suggests an even faster growth rate of approximately 260% compared to the prior year.
  • The HBM market is expected to grow from $35 billion to nearly $100 billion by 2028.
  • Nvidia will utilize Micron's new chips in its powerful Vera Rubin GPU systems launching later this year.
Risk Factors
  • Micron stock recently plummeted 20% from its all-time high after Broadcom issued conservative forecasts for future AI sales.
  • Memory suppliers are racing to build more production capacity, which could lead to price normalization and shrinking earnings in the future.
  • Broadcom's recent revenue forecasts fell short of Wall Street expectations, raising questions about whether peak AI hardware demand is approaching.
  • Alphabet CEO Sundar Pichai reported that many enterprise customers are complaining about rising AI usage costs.
  • Uber Technologies' COO noted that AI spending is becoming harder to justify after the company blew through its 2026 budget in just four months.
  • The Motley Fool Stock Advisor team did not include Micron in their current list of top 10 stocks for investors to buy now.
Full Analysis
Micron Technology (NASDAQ: MU) is a leading supplier of high-bandwidth memory (HBM) essential for AI hardware, currently benefiting from supply shortages that allow it to dictate prices. The stock has surged nearly 700% over the past year but recently dropped 20% following conservative AI sales forecasts from Broadcom, raising concerns about potential demand slowdowns. Micron is set to release its quarterly operating results on June 24, which will provide further insight into the company's trajectory amidst market volatility. The article highlights Micron's recent production of HBM4 chips, offering 60% more capacity than the previous HBM3E solution and improved energy efficiency. These chips are expected to be integrated into Nvidia's new Vera Rubin GPU systems shipping in the second half of the year. The HBM market is projected to grow from $35 billion last year to nearly $100 billion by 2028, though this growth faces risks if AI infrastructure spending slows or if production capacity expands rapidly. Micron reported fiscal 2026 Q2 revenue of $23.8 billion, a 196% increase from the prior year, with Q3 revenue estimated at $33.5 billion (a 260% increase) and earnings potentially reaching $18.90 per share. Despite a forward P/E ratio of 8.1 based on Wall Street's expectation of $105.95 in fiscal 2027 earnings, the author advises caution due to potential price normalization, risks of shrinking future earnings, and broader market signals suggesting peak AI hardware demand may be approaching. Negative indicators include Alphabet CEO Sundar Pichai reporting complaints about rising AI usage costs from enterprise customers and Uber's COO noting unsustainable AI spending after blowing through its 2026 budget in four months. The Motley Fool analyst team, which holds positions in Micron, did not include the stock in their current list of top 10 recommendations, suggesting investors should wait for the June 24 earnings report before rushing to buy, as future outlooks appear cloudier than the current valuation implies.