TLDR
- Micron stock fell 4.7% in premarket Tuesday to $963.79, pulling back after closing above $1,000 the day before.
- Rising bond yields hit the wider chip sector, with SK Hynix down 5.1% and Sandisk down 5.5% in premarket.
- Bank of America named Micron a “top pick,” forecasting fiscal 2030 EPS of $200-$250, well above the consensus of $160-$170.
- Jim Cramer said Micron could “double again,” pointing to AI demand and share buybacks as key supports.
- The U.S. Senate set an August 21 deadline for Apple to respond to suggestions it avoid buying memory chips from Chinese producers.
Micron Technology (MU) stock fell 4.7% in premarket trading on Tuesday to $963.79, reversing a five-day winning run that had pushed the stock back above $1,000 for the first time since early July.
The drop came as rising bond yields pulled the wider semiconductor sector lower. SK Hynix fell 5.1% in U.S. premarket trading, and Sandisk dropped 5.5%. Higher bond yields raise borrowing costs and tend to pressure growth stocks.
Monday had been a strong day for Micron. The stock climbed 4.1% to close at $1,011.75, its fifth straight day of gains. Sandisk added nearly 9%, Western Digital rose 5.4%, and Seagate gained 2.2%. The Roundhill Memory ETF (DRAM) rose 5.4%.
Memory stocks had pulled back from June highs but showed renewed strength through August as second-quarter earnings season wound down.
Bank of America Names Micron a Top Pick
On Monday, Bank of America upgraded Micron to a “top pick,” saying earnings could far exceed current Wall Street expectations. The bank sees Micron’s fiscal 2030 EPS reaching $200-$250, compared to the Street consensus of $160-$170.
BofA pointed to SanDisk’s “durable growth outlook” as evidence the broader memory market may be entering a structurally stronger period.
Wall Street analysts carry an average price target of $1,549 on Micron, according to FactSet. The stock has gained more than 700% over the past 12 months.
Strong cloud growth and record data-center spending from major tech companies have driven the momentum in memory stocks. Some bears argue the long-term demand story is already priced in.
One newer catalyst getting attention is U.S. government pressure on Apple to avoid sourcing memory chips from Chinese producers. That could benefit U.S.-based producers like Micron. The Senate set August 21 as the deadline for Apple to respond.
Jim Cramer Says MU Can Double Again
CNBC’s Jim Cramer said Micron has room to keep running. “I think Micron can double again before the boom comes to an end, assuming there’s no data center slowdown,” he said.
Cramer pointed to share buyback programs as another positive signal. Sandisk has $15.5 billion remaining under its repurchase authorization. Seagate is working through a $5 billion program. Western Digital authorized an additional $4 billion earlier this year.
Cramer’s Charitable Trust, the portfolio tied to CNBC’s Investing Club, recently opened a position in Micron.
The U.S. Senate’s August 21 deadline for Apple’s response on chip sourcing remains the next near-term catalyst for the memory trade.
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