Wall Street Bullish on Micron's Long-Term Prospects, but Divided on When Earnings Will Peak

Deep News
09/28

Despite persistent market concerns about the durability of AI demand and intensifying industry competition, Wall Street remains bullish on Micron Technology (NASDAQ: MU) ahead of its fiscal 2026 fourth-quarter earnings report. According to TipRanks data, the average price target on Wall Street for Micron implies upside of 54%.

Ahead of the fiscal 2026 Q4 earnings report, TD Cowen analyst Krish Sankar reiterated a "Buy" rating on Micron with a price target of $1,600. The five-star analyst believes the industry is still in the middle of its cycle, with Micron's demand remaining strong, even as gross margins approach 80% in this expansion cycle. He expects gross margins to peak in the second quarter of calendar year 2027, at around 89%. Sankar also projects that Micron will guide for fiscal 2027 first-quarter earnings per share of about $37, above the consensus estimate of $35. In his view, further share price gains will come from valuation re-rating rather than continued gross margin expansion, and he judges the stock's risk-reward profile as still "attractive."

Echoing Sankar's view, Deutsche Bank analyst Melissa Weathers is also bullish on Micron. The five-star analyst maintained a Buy rating ahead of the Q4 earnings report, saying fundamentals are "stronger for longer than expected." Melissa updated her global supply and demand model to incorporate the latest market changes. The overall results show that the DRAM supply-demand gap will widen further in 2027 and 2028, with the market potentially reaching supply-demand balance in 2029 before shifting to oversupply in 2030. Melissa's model continues to show strong long-term demand, significantly above the historical average. DRAM demand is expected to grow at a compound annual growth rate (CAGR) of about 21% through 2030, compared with a historical average of only around 15%. The analyst noted that DRAM wafer supply CAGR has been revised up to more than 15%, above the previous forecast of more than 12%, but supply growth remains well below demand growth.

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