JPMorgan Keeps Overweight on Micron, $1,540 PT

JPMorgan analyst Harlan Sur reiterated an Overweight rating and $1,540 price target on Micron Technology (NASDAQ: MU).

“MU is set to report Aug-Qtr (F4Q26) earnings on Wednesday (Sept 30), and we see the setup as constructive with multiple beat-and-raise levers still in play against a memory backdrop that remains structurally tight across both DRAM and NAND.

On the print itself, we think MU is well-positioned to deliver Aug-Qtr revenue, gross margin, and EPS ahead of Street $51.4B/86.2%/$31.73, with pricing momentum through the quarter still tracking robust despite mgmt’s prior commentary on a “meaningful moderation in the rate of price increases” – in our view, moderation here reflects a strategic decision to preserve customer relationships and cement long-term SCA commitments rather than any demand side softening, a nuance we think investors will increasingly appreciate as the SCA framework rolls out.

On DRAM/HBM despec, our own analysis (as laid out in our global team’s recent Memory Market Update) indicates that even after fully accounting for the despec, the industry S-D gap remains materially in shortage through CY27 and extends through CY28 (JPMe HBM S-D shortage of -20%/ 19%/-16% in CY26E/27E/28E, with accumulated shortage widening to 23 weeks by CY28E), which we think supports an upward bias to pricing into CY27-28.On the Nov-Qtr (F1Q27) guide, our expectation is that mgmt raises the bar again given (1) recent company commentary that aggregate demand signals from customers have “increased even further” since the last print, (2) mgmt’s newly-elevated CY27 view (now expected to be “even tighter” than CY26, vs. prior “beyond CY27” framing), and (3) continued HBM4 ramp momentum (12-high tracking 2x faster than HBM3E; >$1B already shipped as of May-Q).

That said, the more meaningful development we expect from the print is on the SCA and capital return fronts – we think the market underappreciates the pace at which SCA coverage is compounding, and our base case is that forward bit production coverage now likely sits in the 35%+ range (up from ~20%/~33% of DRAM/NAND volumes disclosed on the last call), with strong potential that coverage is already tracking in the 50%+ range.”

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