Important points
Micron (NASDAQ:MU) saw a recovery this morning, bouncing back 3.3% by 11:30 a.m. ET, following two days of losses.
This positive shift can be attributed to Japanese investment bank Mizuho.
Mizuho talks about Micron
Yesterday, Mizuho increased its price target for Micron by $5, bringing it to $270 per share. They noted that DRAM prices are climbing, and there’s a growing demand for NAND high bandwidth memory (HBM). As artificial intelligence applications become more prevalent, it’s notable that currently, under 10% of Micron’s revenue comes from HBM. On a brighter note, DRAM gross profit margins are trending upward and are expected to increase by early 2026.
Moreover, Mizuho mentioned that about 60% to 65% of Micron’s DRAM supply contract prices reset quarterly. This suggests that Micron could benefit from price hikes in a matter of months.
What to expect from Micron in 2026
Considering these projections, Mizuho forecasts that Micron will generate $56 billion in sales next year, with earnings around $17.89 per share. They anticipate an 18% growth in sales, reaching approximately $66.1 billion, and a 21% earnings increase to $21.69 in 2027.
A share price of $235 implies Micron’s stock is more than 30 times its current earnings. Current earnings might be around 13 times next year’s earnings and under 11 times those expected for 2027.
With profits projected to rise by 21%, one has to wonder if it’s undervalued. Mizuho seems to think it is, and I might be inclined to agree.
Should you invest $1,000 in Micron Technology right now?
Before making any investment in Micron Technology, consider the following:
The Motley Fool’s analyst team has pointed out that while there are some promising stocks out there, Micron Technology isn’t currently on their list of recommendations. They’ve highlighted ten stocks that might yield impressive returns over the next several years.
For instance, if you had put $1,000 into Netflix back when it was recommended, it would now be worth about $556,658! Or NVIDIA, which would have turned your $1,000 into approximately $1,124,157!
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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
