This article first appeared on GuruFocus.
A KeyBanc analyst raised earnings projections for Micron (NASDAQ:MU) on Monday and kept a buy rating on the memory chip company.
The stock gained about 3% trading following the update. Analyst John Vinh set a $600 price target, which suggests the shares could climb roughly 60% from where they recently traded.
Vinh now forecasts earnings of $64.37 per share for the company’s 2026 fiscal year, up from an earlier estimate of $60.18. For fiscal 2027, the projection moved higher to $131.38 per share from $118.49. The analyst cited solid demand for processors and memory products as a primary factor behind the increases.
Micron makes two main types of memory chips. NAND handles long-term storage in devices like smartphones and solid-state drives. DRAM serves as temporary working memory in computers and data center servers.
A recent announcement from Google (NASDAQ:GOOGL) about a new compression algorithm added further pressure. The technology improves AI efficiency and cuts memory needs. Some analysts, however, believe better AI efficiency could eventually boost overall memory demand.
Vinh also noted that pricing for DRAM and NAND may rise 30% to 50% in the current quarter. New multi-year supply deals with major cloud providers include pricing floors and upfront payments, which could limit downside during industry downturns.
