TLDR
- Micron stock rose about 5% on Monday, outperforming a flat S&P 500
- MU has gained in 11 of the last 15 sessions and more than doubled since late March
- D.A. Davidson reiterated a Buy rating with a $1,000 price target on May 11
- The rally is driven by tight memory supply conditions and AI infrastructure demand from hyperscalers
- Analysts expect global memory margins above 75% by 2026, with HBM and longer-term contracts reshaping the business
Micron stock rose around 5% on Monday, extending a run that has seen the stock more than double since late March.
The broader market was largely flat, with the S&P 500 little changed and most sectors under pressure from higher energy prices and geopolitical concerns. Micron moved in the opposite direction.
MU has now gained in 11 of the last 15 sessions. That kind of consistency is hard to ignore.
The Roundhill Memory ETF (DRAM) also climbed alongside Micron on Monday. South Korea’s SK Hynix and Samsung Electronics both advanced in line with the broader chip sector.
The rally is being driven by two things: tight supply conditions in the memory market and growing demand from hyperscalers building out AI infrastructure. Traders and analysts say both forces are working in Micron’s favor at the same time.
D.A. Davidson Reiterates Buy With $1,000 Target
On May 11, D.A. Davidson reiterated its Buy rating on Micron and kept its $1,000 price target in place. The firm called it a “table-pounding buy.”
The firm said it has increased conviction following investor conversations. “We are blissfully unencumbered by the memory industry’s past,” the firm wrote.
D.A. Davidson acknowledged that many investors still see Micron as a cyclical business tied to the old patterns of the memory industry. The firm disagrees.
It pointed to three factors changing the story: high-bandwidth memory (HBM), the DRAM oligopoly structure, and a shift toward longer-term customer contracts. Together, these are creating a more stable and profitable business model.
The firm also said investors are underestimating “the new math of memory in the AI age” and how much the current cycle can benefit Micron.
Margin Expectations Rise Across the Sector
Analysts are increasingly optimistic about margins. Globally, memory margins are expected to top 75% by 2026, according to sector analysts tracking the space.
That number would have seemed out of reach in previous cycles. The argument now is that AI-driven demand is structurally different from consumer or PC-driven cycles of the past.
Micron ranked fifth on one list of 12 AI stocks Wall Street is currently watching.
The stock’s performance this month has put it in rare company. Very few large-cap names have more than doubled in roughly six weeks.
As of Monday’s session, Micron continued to trade separately from broader market moves — a sign that the chip-specific thesis is doing the heavy lifting for now.
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