TLDR
- Cantor Fitzgerald lifts Micron Technology price target from $350 to $450, citing cost reduction potential and improved margins expected in 2026
- Stock has soared 248% over the past year as AI-driven demand for high-bandwidth memory accelerates across the semiconductor industry
- Latest quarterly revenue hit $13.6 billion, up from $8.7 billion year-over-year, while operating cash flow more than doubled to $8.4 billion
- Micron remains one of just three global producers of HBM at scale, creating supply constraints that support premium pricing
- Forward P/E ratio sits below 11 compared to tech sector average of 26, suggesting valuation opportunity despite recent gains
Cantor Fitzgerald boosted its price target on Micron Technology to $450 from $350. The firm maintained its Overweight rating on the semiconductor stock.
The upgrade centers on anticipated cost reductions that could lift gross margins above current expectations. Cantor Fitzgerald projects these improvements will materialize throughout calendar year 2026.
Micron’s stock has already rewarded investors with 248% gains over the past 12 months. The rally reflects surging demand for specialized memory chips used in artificial intelligence applications.
The company currently operates with a gross profit margin of 45.31%. Its PEG ratio of 0.16 suggests shares remain attractively priced relative to growth potential.
Manufacturing Improvements Support Higher Targets
Cantor Fitzgerald highlighted several operational factors behind the upgrade. Cost execution has exceeded initial projections across multiple product lines.
Non-HBM content growth in servers came in stronger than anticipated. This provides revenue diversification beyond the company’s core high-bandwidth memory business.
The firm noted faster-than-expected yields for 12-high HBM utilizing 1-gamma technology. These manufacturing gains improve efficiency and lower production costs per unit.
A strong G9 NAND memory ramp is planned for the second half of the fiscal year. Increased utilization rates driven by robust bit growth add further support to the bullish outlook.
22 analysts have revised earnings estimates upward for Micron in recent weeks. This reflects growing confidence in the company’s ability to execute on its roadmap.
Limited Competition Creates Pricing Power
Micron stands as one of only three companies worldwide capable of producing high-bandwidth memory at commercial scale. Samsung and SK Hynix round out this exclusive group.
This supply constraint gives Micron pricing power in a market where demand continues to accelerate. HBM requirements are expected to increase tenfold over the next decade.
The company’s customer roster includes leading AI companies like Nvidia and AMD. These relationships provide stable demand visibility for production planning.
Revenue jumped to $13.6 billion in the most recent quarter from $8.7 billion in the prior year period. Operating cash flow surged to $8.4 billion compared to $3.2 billion year-over-year.
Micron trades at a forward price-to-earnings ratio just under 11. The broader tech industry averages a forward P/E of 26, making Micron’s valuation compelling on a relative basis.
New entrants would face significant hurdles entering the HBM market. The capital investment and technical expertise required create high barriers to entry that protect existing players.
The supply-demand imbalance won’t resolve quickly. Industry experts expect constraints to persist for several more years, providing extended runway for margin expansion.
Cantor Fitzgerald models high-single-digit percentage declines in DRAM pricing for 2026. The firm also expects mid-teens percentage declines in NAND pricing during the same period, though volume growth should offset these pressures.
Micron announced plans for a $100 billion semiconductor facility in New York. The project represents the largest private investment in state history and will expand manufacturing capacity to meet growing customer demand.
