HSBC Raises Micron Price Target to $500

HSBC analyst Ricky Seo raised the price target on Micron Technology (NASDAQ: MU) to $500.00 (from $350.00) while maintaining a Buy rating.

“Micron’s share price rose 92% over the past 3M (vs.

NASDAQ up 1%) on the faster DRAM price rally.

Now, with more storage demand at inferencing platforms, we see NAND as the next catalyst.

While inferencing activities are soaking up server DRAM output and boosting memory prices, we raise our FY2Q OP by 6%, with OP at USD12bn (+88% q-o-q) on sales of USD20bn (+47% q-o-q), and DRAM blended ASP rising 45% q-o-q (vs 37% previously).

We see incremental demand growth for server DRAM and enterprise SSD (eSSD) for token management, retrieval augmented generation (RAG) and key- value (KV) caching, which are key parts of inferencing.

The resulting supply shortage is also driving up PC and mobile DRAM pricing based on a lean inventory level of 2-4 weeks at DRAM makers.

We believe this shortage will persist until the year-end, leading to stronger earnings growth in FY26e at USD51bn OP (+368% y-o-y) with sales of USD84bn (+124% y-o-y).

We also expect 7% more capex to expand DRAM capacity from 2H27e, and more dividend, with a payout ratio of 6%.”

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