Micron Technology's stock has experienced remarkable growth, hitting a new all-time high as it benefits from a global shortage of memory chips. The company's shares have increased more than 300% year-to-date, reflecting strong investor sentiment despite concerns about potential market saturation.
Analysts are anticipating robust earnings for the third quarter, with a FactSet consensus estimate of $20.42 per share, although many expect even higher results. The Bank of America trading desk has reported a buyside whisper number of $22.17, indicating strong buyer confidence.
A key driver of this demand is the increasing use of artificial intelligence, particularly in 'inference' applications, which Micron has highlighted as a significant growth area. Analysts from Needham and Bernstein have raised their price targets for Micron, with Needham setting a new target of $1,550, up from $500, and Bernstein increasing theirs to $1,300 from $510.
Morgan Stanley also projects a third-quarter EPS of $21.31 and has set a base case price target of $1,050. However, Goldman Sachs remains more cautious, maintaining a $900 price target while also predicting an EPS above consensus. They emphasize the importance of disclosures regarding Micron's customer agreements and pricing strategies, which could influence investor sentiment moving forward