Micron Technology, Inc.

NASDAQ Global Select
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Very Bullish +78

Micron stock falls 4%, why this analyst sees 40% upside for the stock?

AI infrastructure Analyst upgrade Company update AI-generated analysis

📉 Micron stock fell 4% on Thursday as investors weighed rising US Treasury yields and crude oil prices ahead of the fiscal Q4 earnings report due Sept. 30.

🚀 Baird raised its price target to $1,520 from $1,280, implying ~40% upside, driven by higher-margin HBM outlook and improving pricing conditions.

💰 Zacks Consensus estimates DRAM revenue at $38.26 billion for the quarter, a 325.8% increase year-over-year due to AI demand and market normalization.

🔒 Micron is mass-producing HBM for NVIDIA's Blackwell GPUs, capitalizing on tight supply and surging demand from AI data centers.

⚡ The HBM4 12-high ramp is progressing faster than the HBM3E version, expected to boost revenue and profitability over time.

🤝 Micron supplies HBM3E for AMD's Instinct MI350 accelerators and collaborates with Marvell on advanced memory solutions for AI applications.

📊 46 of 49 analysts track the stock as a buy or strong buy, with an average price target implying ~34% upside from current levels.

🔮 If Micron prints strong DRAM/HBM guidance into Sept. 30, the market is expected to re-rate quickly after the recent selloff.

Bullish Signals
  • Baird raised its price target to $1,520 from $1,280, implying ~40% upside, grounded in higher-margin HBM and improving pricing conditions.
  • DRAM is expected to be the biggest growth engine in Q4 with consensus revenue estimates of $38.26 billion, a 325.8% year-over-year increase.
  • Micron is mass-producing HBM for NVIDIA's Blackwell GPUs, securing exposure to growing demand for AI infrastructure amidst tight supply.
  • The HBM4 12-high ramp is progressing faster than the HBM3E version, potentially increasing HBM's contribution to revenue and profitability.
  • Micron supplies HBM3E products for AMD's Instinct MI350 AI accelerators, diversifying its exposure to major AI platforms.
  • 46 of 49 analysts tracked by LSEG rate the stock a buy or strong buy, with an average price target implying ~34% upside.
  • The industry has moved from excess supply and weak pricing to a healthier balance, supporting DRAM revenue and profitability in the quarter.
Risk Factors
  • Micron shares fell 4% on Thursday as investors weighed rising US Treasury yields and higher crude oil prices ahead of earnings.
  • Key risk exists that AI memory demand disappoints or HBM ramps slower than expected, causing guidance to miss and DRAM pricing to weaken.
Full Analysis
Micron Technology (MU) shares fell 4% on Thursday as investors reacted to rising US Treasury yields and crude oil prices ahead of the company's fiscal fourth-quarter earnings report scheduled for September 30. Despite the short-term decline, analyst sentiment remains strongly bullish, with Baird raising its price target to $1,520 from $1,280, implying approximately 40% upside from Friday's close. The firm maintains an outperform rating, citing incremental positive near- and medium-term prospects driven by surging demand for agentic artificial intelligence and a structural supply shortage expected to persist into 2027. DRAM is projected to be Micron's primary growth engine for the upcoming quarter, with Zacks Consensus Estimates predicting revenue of $38.26 billion, representing a massive 325.8% year-over-year increase. This significant growth is underpinned by improving market conditions where excess supply and weak pricing have normalized into a healthier balance between demand and availability. The combination of robust AI-driven demand and recovering pricing power is expected to substantially support both Micron's revenue and profitability in the fiscal fourth quarter. High-bandwidth memory (HBM) has emerged as a critical component of Micron's strategic outlook, with the company currently mass-producing HBM for NVIDIA's next-generation Blackwell GPUs. Supply constraints for HBM remain tight while demand from AI data centers continues to escalate, creating a favorable environment for higher margins. Additionally, Micron is advancing its HBM4 12-high ramp faster than previous generations, which is poised to further increase the product's contribution to overall revenue and profitability in the coming year. Beyond NVIDIA, Micron has secured significant exposure to other major AI platforms by supplying HBM3E products for AMD's Instinct MI350 accelerators and collaborating with Marvell Technology on advanced memory solutions. With 46 out of 49 analysts tracking the stock rating it as a buy or strong buy, the consensus price target implies about 34% upside. The market is closely watching the September 30 earnings release for any guidance updates that could trigger a rapid re-rating following the recent selloff.