Micron at 5.65x: $6,000 could reach $7,380 by 2028

Micron's run has been driven by a specific shift in AI hardware: as GPU clusters scaled for larger models, memory became the next bottleneck. NAND flash stores the large training data sets, while DRAM stacked into high bandwidth memory sits beside GPUs to hold model parameters during training and inference. That demand pushed memory prices up and produced an earnings surge. Micron COO Manish Bhatia said on the most recent earnings call that "we really don't have line of sight to when supply and demand balances."

The valuation debate is framed around whether this memory cycle behaves differently from past ones. Memory makers are typically seen as cyclical because supply is hard to match to demand, and investors have wondered if that pattern holds this time. Micron has secured 16 Strategic Customer Agreements running three to five years, which is atypical for memory companies. Even so, the market still applies a mid-single-digit multiple, which is why the base-case math yields only about 23% upside.

The skeptical case rests on two recent developments: reports of a new memory chip from China that could fit more memory in a denser area, and reports from South Korea citing industry experts who expect heavy supply to enter the market in 2029. Given that uncertainty, the conclusion is that owning some Micron stock is fine now, but investors may not want to go in too heavy on a stock that could be very volatile, even long-term.