TLDR
- Cantor Fitzgerald raised Micron Technology’s price target to $450 from $350, maintaining an Overweight rating based on expected cost reductions and margin improvements in 2026
- The stock has delivered 248% returns over the past year, driven by strong demand for high-bandwidth memory in AI applications
- Micron is one of only three companies worldwide capable of producing HBM at scale, creating a supply constraint that supports pricing power
- Revenue jumped to $13.6 billion in the latest quarter from $8.7 billion year-over-year, while operating cash flow surged to $8.4 billion from $3.2 billion
- The company trades at a forward P/E ratio under 11, well below the tech industry average of 26, despite its dominant position in the growing HBM market
Cantor Fitzgerald upgraded its price target on Micron Technology to $450 from $350 while maintaining an Overweight rating. The firm expects cost reductions to push gross margins and profitability higher than current forecasts for calendar year 2026.
The upgrade comes as Micron has already delivered impressive returns. The stock surged 248% over the past year as demand for specialized memory chips exploded.
Micron currently holds a gross profit margin of 45.31%. The company’s PEG ratio sits at 0.16, suggesting the stock remains undervalued relative to its growth trajectory.
22 analysts have recently revised their earnings estimates upward for Micron. This growing consensus reflects confidence in the company’s execution capabilities and market position.
Strong Operational Performance Drives Optimism
Cantor Fitzgerald pointed to several operational factors supporting the higher price target. Better-than-expected cost execution stands as a primary driver of the improved outlook.
Non-HBM content growth in servers exceeded initial projections. This diversification beyond high-bandwidth memory provides additional revenue streams.
The firm also highlighted faster-than-expected yields for 12-high HBM using 1-gamma technology. This manufacturing advancement improves production efficiency and reduces per-unit costs.
A robust G9 NAND memory ramp is expected in the second half of the fiscal year. Higher utilization rates driven by strong bit growth further support the bullish case.
Despite the positive outlook, Cantor Fitzgerald models high-single-digit percentage declines in DRAM for calendar year 2026. The firm also projects mid-teens percentage declines in NAND during the same period.
High-Bandwidth Memory Creates Competitive Moat
Micron stands as one of only three companies globally capable of producing high-bandwidth memory at scale. This limited competition creates pricing power and protects margins.
HBM demand is expected to grow tenfold over the coming decade. Graphics processing units and AI chips require massive amounts of this specialized memory.
Micron’s customer base includes the world’s biggest AI companies. Nvidia and AMD depend on reliable HBM supplies to meet their own production goals.
The memory market bottomed out after years of decline but now sits in a multi-year upswing. Revenue reached $13.6 billion in the latest quarter compared to $8.7 billion a year earlier.
Operating cash flow jumped to $8.4 billion from $3.2 billion in the same period last year. This cash generation provides resources for continued capacity expansion and technology development.
Micron trades at a forward price-to-earnings ratio just under 11. The tech industry average sits at 26, making Micron’s valuation look attractive.
New competitors would need years to develop HBM production capabilities. The capital investment and technical expertise required create high barriers to entry.
The supply constraint won’t resolve for several more years. This timeline gives Micron extended runway to capitalize on favorable market conditions.
Micron announced plans to break ground on a $100 billion semiconductor megafab in New York. This represents the largest private investment in the state’s history and will expand production capacity to meet growing demand.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
