Investors are still “early in their journey” when it comes to understanding Micron Technology and how to value its stock, according to an analyst.

D.A. Davidson’s Gil Luria believes investors haven’t properly taken into account the company’s expected growth trajectory over the next three to five years, he said. Likewise, he suggested that the stock’s dirt-cheap valuation multiple doesn’t reflect its true worth.

On Wednesday, Luria raised his price target on Micron’s stock to $3,000 from $2,100. The new target implies room for the stock to essentially triple from its current price level of $1,016.

Luria’s target is based on the idea that investors could come to assign a greater value to every dollar that Micron earns. The target assumes a multiple of about 19 times estimated earnings per share for fiscal 2027, which ends in August. The stock currently trades at just six times estimated earnings for that fiscal year, according to Dow Jones Market Data.

Shares of Micron have risen 266% so far this year, but the price-to-earnings multiple has actually come down since the end of 2025 as expectations for earnings growth have outpaced the stock rally.

One big reason behind Luria’s optimism is that demand for memory chips is set to outstrip supply for several years. “Memory is a lever for better AI performance. AI models generate better results with more memory, run faster with more memory,” he wrote.

Another noteworthy catalyst for Micron, Luria wrote, is that the company is expected to launch a major buyback program in December, once it’s free of major restrictions on share repurchases that were a condition of its Chips Act government funding.

When companies repurchase their own stock, they reduce the number of shares outstanding, and that can help boost earnings per share. This dynamic could be a boon for Micron’s stock.

Shares of Micron were up 1.8% in morning trading.