TD Cowen Reiterates Buy on Micron, $125 Price Target

TD Cowen analyst Krish Sankar reiterated a Buy rating and $125 price target on Micron Technology (NASDAQ: MU).

“Cautiously Optimistic as Pricing Excitement Feels Premature; Our checks do indeed point to improved outlook as suppliers collectively push for higher DRAM/NAND pricing, but we see risk that investors may start to question the sustainability of that trend amid end-demand weakness.

We are cautiously optimistic in the near term; LT we prefer memory exposure via semicaps (our top pick, LRCX) given the lower downside risk and the uncertainty around the macro.

We are keeping our estimates unchanged ($1.35 EPS for MayQ), as we believe it’s still early to move them higher despite our checks trending more positively compared to a few months ago.

Specifically, we see consistent efforts across all DRAM/NAND suppliers to drive price increases that if materialized, can drive an EPS outlook higher than us/Street for MU in C26 (St. $11.60, TD Cowen $8).

We think demand recovery is crucial for that to transpire, and we prefer prudence. Estimates wise, we see small upside to our $1.35 EPS MayQ estimate (Street $1.55).”

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