Morgan Stanley Upgrades Micron to Overweight, $220 Price Target

Morgan Stanley analyst Joseph Moore upgraded Micron Technology (NASDAQ: MU) from Equalweight to Overweight with a price target of $220 (from $160).

“Momentum on core DRAM pricing continues to surprise us, while at the same time near term worries on HBM are becoming solved by DRAM economic improvement.

Our checks in DRAM continue to get stronger, with potential for double digit sequential price improvement calendar 4q and 1q, and while the direct causes are hard to pinpoint, sentiment from our industry contacts that DRAM may be tight for several quarters is increasingly widespread amongst our contacts in the purchasing world.

And while MU has outperformed, we see more room to run as upward revisions continue (DDR5 spot pricing already up 15% since MU guided) and sentiment (primarily due to HBM concerns) is not yet universally positive.

With anecdotes about DDR5 server pricing up double digits in Q4 and at least that much in Q1 we think our current estimates are likely to prove even more conservative than we thought just last week.”

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