Micron Technology's stock surged 7% in pre-market trading on Wednesday, following significant analyst optimism regarding the company's prospects in the AI-driven memory market.
The sharp upward movement comes after Morgan Stanley raised its price target for Micron to $450 from $350, maintaining an Overweight rating. The analyst firm highlighted that the current memory chip shortage, fueled by the artificial intelligence super-cycle, has created a structural supply-demand imbalance. They noted that pricing power for DRAM and NAND memory is firmly with sellers, leading to substantial earnings revisions for Micron.
Adding to the positive sentiment, Deutsche Bank also raised its price target on Micron to $500, arguing this memory cycle is structurally different due to explosive demand for High Bandwidth Memory (HBM) required for advanced AI chips. The bank expects supply to remain tight through 2027-2028, supporting a more profitable environment for memory producers like Micron.