MW Micron's stock is heading for its best winning streak since 2019. Here's why.

By Britney Nguyen

Ahead of Micron's earnings, analysts are upbeat about the pricing environment for memory chips and the company's broader opportunity as AI demand swells

Micron's stock is headed for a 10-day winning streak.

Micron Technology Inc.'s stock has been climbing ahead of earnings - and so have Wall Street's price targets.

As demand for artificial-intelligence chips stays strong, Micron $(MU)$ looks poised to maintain its share of the lucrative market for high-bandwidth memory chips and benefit from an upbeat pricing environment.

For investors, that means potential upside to the memory-chip maker's guidance for the October quarter when the company reports results next week. Its HBM3e 12-Hi chips are used in Nvidia Corp.'s (NVDA) Blackwell Ultra graphics processing units, and that Nvidia product is seeing stronger-than-expected demand, analysts at Mizuho said in a late Monday note. 12-Hi means there are 12 dynamic random access memory, or DRAM, layers, which have more storage capacity.

The Mizuho team expects momentum to continue with Nvidia's upcoming Rubin rack-scale server system, which is expected to use the HBM4 12-Hi chips that Micron is currently sampling with customers. The chips could have about a 15% price premium compared with the HBM3e, the analysts said. They added that Micron's stock could see more tailwind from the Rubin AI platform Nvidia plans to unveil in 2027, which is expected to use a newer generation of Micron's HBM chips.

Mizuho kept its outperform rating on Micron's stock and raised its price target from $155 to $182.

Micron shares recently changed hands at $158.54, up fractionally on the day and heading toward a 10-day winning streak. That would be the longest since an 11-day run that ended in December 2019, according to Dow Jones Market Data.

See more: Micron's stock surges to a record. What's behind the best seven-day rally in a decade.

In the race for the next-generation HBM4, the Mizuho analysts said they believe Micron "could continue to be one of only two qualified suppliers" of the chips alongside South Korea's SK Hynix Inc. (KR:000660), as Samsung Electronics Co. Ltd. (KR:005930) looks "still not qualified" because of heating issues.

The analysts estimate the HBM market could grow 100% to $41 billion by the end of fiscal year 2025. SK Hynix is seen as the leader with a 52% market share, while Micron has a 23% share. Micron's HBM revenue could reach $20 billion by the end of fiscal year 2027, Mizuho estimated.

Both SK Hynix and Micron are believed to have shipped initial samples of HBM4 to Nvidia for its Rubin AI platform, the analysts said, noting that demand for application-specific integrated circuits from Broadcom Inc. $(AVGO)$ "remains strong," which is helping Micron's HBM3e orders.

Better pricing for NAND-DRAM is making for "a healthier supply/demand balance," Mizuho said, adding that Micron could stop sharing pricing indicators for DRAM and NAND flash memory while AI drives demand. That could lead to prices for DRAM increasing by 20% to 30%, the analysts said.

See more: Micron's stock climbs after upbeat guidance. Here's what's driving the momentum.

Deutsche Bank Research analysts also pointed to tightening DRAM supply as a reason for raising their own Micron estimates in a Monday note.

Tighter supply should spur "healthy" growth in average selling prices, boosting gross margins, the analysts said, adding that they see a "clear path" for Micron to expand its gross margin to over 50%. The company reported a 39% adjusted gross margin in its latest earnings report in June.

Recent pricing momentum in NAND is also encouraging, Deutsche Bank said.

"We believe recent fears around HBM pricing in 2026 to be overblown," the analysts said, referring to investors' concerns that more competition and supply could take away the premium pricing advantage. Micron looks "particularly well positioned to maintain its HBM market share at still-attractive profitability levels."

In its upcoming earnings report, the analysts said they don't expect Micron to say much about current HBM contract negotiations due to uncertainty over supply in 2026 and the timing of product launches from its customers.

"Given the rising importance of HBM in AI applications as well as a vastly favorable supply/demand environment, we see room for upside not only for [Micron's] estimates, but also its multiple," the analysts said.

Deutsche Bank raised its price target to $175 from $155, and kept its buy rating on the stock.

-Britney Nguyen

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

September 16, 2025 11:04 ET (15:04 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.