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Citigroup Sees Micron Technology (MU.US) Up to $840! Target Price Nearly Doubles

Citigroup has sharply raised Micron Technology (MU.US)’s stock target price from $425 to $840 and maintains a “Buy” rating. The reason is the expectation that the company will raise the price of dynamic random-access memory (DRAM).

Analysts said: “We have raised Micron’s target price from $425 (equivalent to 5 times earnings per share for the 2027 fiscal year) to $840 (equivalent to 8 times earnings per share for the 2027 fiscal year) because we believe that, after industry peer Samsung raised prices by 100% in the first fiscal year, Micron will increase DRAM prices by more than 40% in the second fiscal year. In addition, we expect the DRAM upcycle to continue through 2027, and we expect the price of HBM [high-bandwidth memory] to rise next year.”

“Most of this year’s DRAM price increases have been concentrated in supply-and-demand imbalances for commoditized or non-HBM DRAM. Although given expectations recently issued by equipment makers such as Applied Materials (AMAT.US) for more than 30% growth in silicon systems sales, we believe that DRAM bit supply growth is heading toward 30% by the end of 2026, but additional new wafer capacity will still be needed to meet AI demand in 2027. We align Micron’s forecast with Citigroup’s research view that the average selling price (ASP) of DRAM will surge 200% year over year in 2026, while the average selling price of NAND will increase 186% year over year in 2026.”

SK Hynix and Samsung Electronics of South Korea are among the world’s largest memory chip manufacturers. SK Hynix is a major supplier of NVIDIA HBM chips. Samsung and Micron compete in this field with SK Hynix. $MU