MU Stock Targets $1,100 Again but Can It Break Out as DA Davidson Raises Micron Technology Price Target to $3,000

Micron (MU) and SanDisk (SNDK) have surged due to AI-driven demand, with gains of 953% and 3,398.70% over two years. Despite strong earnings and guidance, both stocks have recently stagnated amid debates over cyclicality. DA Davidson raised Micron's price target to $3,000, citing investor sentiment. Analysts expect Micron's earnings to rise 699% next quarter, with supply constraints lasting until 2027. Both stocks have a P/E of 13.85x.

D.A. Davidson's Gil Luria raised Micron's price target to $3,000, citing AI-driven memory demand and a December buyback. Micron's shares have risen 260% this year, with fiscal Q4 revenue at $54B, beating forecasts. The target assumes a 19x multiple on fiscal 2027 earnings, higher than current 6x. Other analysts' targets are lower, with an average near $1,560.

Micron (MU), SanDisk (SNDK), and SK Hynix shares fell in premarket trading due to strike risk at Micron's Taiwan plants, softer NAND prices, and Toshiba's HDD capacity expansion. Micron's Taiwan workers authorized a strike vote, while NAND wafer prices dropped 2.9% this week. Toshiba's $380M investment in HDD capacity is seen as a supply-side signal, impacting sentiment in the AI memory sector. The declines extend a correction that has erased 30% or more from the sector's summer peaks.

Memory stocks fell in premarket trading due to Toshiba's plan to expand hard-drive production, raising concerns about supply and pricing. Micron (MU) dropped 2%, SanDisk (SNDK) 2.18%, and SK Hynix (SKHY) 0.7%. Cantor Fitzgerald views the sell-off as overdone, citing strong demand and Toshiba's limited market share. Micron also faces potential strike action in Taiwan. Year-to-date gains for the stocks are 266.34%, 599.49%, and 8.66%, respectively.

DA Davidson raised Micron Technology's (MU) price target to $3,000, up from $2,100, citing AI-driven memory demand. This represents a 195% upside from its current share price of $1,018. The firm maintained a Buy rating, projecting strong demand and supply constraints through 2028, with long-term customer agreements stabilizing revenue.

Micron reported Q4 revenue of $54.23B, up 379% YoY, with adjusted EPS at $33.42. The company expects tight supply-demand conditions through fiscal 2027-2028, with $32B in long-term agreements. HBM production for 2027 is mostly contracted. High margins and multiyear supply deals indicate buyers prioritize availability over price. Micron plans significant capital expenditure but notes supply lags demand. Management forecasts strong fiscal 2027 with Q1 revenue of $61.5B and 86.25% gross margin.