Micron Technology Inc. (Micron (MU)) shares took a step back in Friday's premarket session, falling 3.48% to $749. The dip comes after a wild week where the memory maker briefly brushed up against a $900 billion market capitalization — a milestone that seemed unthinkable not long ago.
Traders appear to be locking in profits after a parabolic rally that has pushed the stock up more than 146% year-to-date. The broader market isn't helping either: Nasdaq futures are down 1.32%, and S&P 500 futures have slipped 0.89%.
But the long-term story? That's still very much intact, if not getting stronger.
Analyst Nearly Doubles Price Target to $950
Bank of America analyst Vivek Arya issued a massive upward revision this week, nearly doubling his price forecast on Micron from $500 to $950. His reasoning? Memory supply is getting tighter, and that's a good thing for pricing.
Arya pointed to what he calls "structurally lower" memory supply elasticity — basically, it's becoming harder and more expensive to build new fabrication plants. Capital constraints, power limitations, and geopolitical hurdles are all making it tough to ramp up production quickly. "We view memory supply elasticity as now structurally lower," Arya wrote. That shift, he argues, keeps pricing power firmly with sellers through 2028.
AI Demand Is the Real Engine
The analyst also raised his 2030 forecast for AI data center systems to a staggering $1.7 trillion. He expects memory content per AI accelerator to jump from 187 gigabytes today to 464 GB by 2030.
Micron's High-Bandwidth Memory (HBM) is central to this growth. Arya projects the HBM market will reach $168 billion by 2030. He specifically called out NVIDIA Corp.'s (Nvidia (NVDA)) Vera Rubin systems as a catalyst that will drive immediate purchase orders for Micron's HBM.
Supply Constraints: Near-Term Pain, Long-Term Gain
Micron plans to spend over $25 billion in fiscal 2026 on capital expenditures. But don't expect that to translate into new supply anytime soon. Arya warned that meaningful new output is a 2028 story.
The company's Idaho fabrication plant won't deliver any output until mid-2027. Most of the current spending is going into cleanrooms and infrastructure, not immediate production equipment. That lag supports the thesis of sustained higher pricing for both DRAM and NAND memory.
Sector Caps Force Institutional Selling
Separately, Ross Gerber, co-founder of Gerber Kawasaki, confirmed that his firm sold small positions in Micron, Nvidia, and Broadcom Inc. (Broadcom (AVGO)). But don't read too much into it — the sales were mandatory to comply with a 25% sector cap limit.
"This was a requirement of diversification in my fund," Gerber stated on X, though he remains "very bullish" with a long-term price forecast of $1,140 for MU. So while the stock may be taking a breather today, the believers are still holding on tight.
