Micron Stock Will Retest All-Time Highs This Year

Core Viewpoint - Micron Technology's Q2 results and guidance indicate a significant increase in demand for AI-related products, similar to NVIDIA's recent performance, suggesting a potential retest of all-time highs for its stock price [1][2]. Financial Performance - Micron reported Q2 net revenue of $8.05 billion, a 38.3% year-over-year increase, surpassing consensus estimates by 170 basis points, driven by a 47% increase in DRAM sales and an 18.4% increase in NAND sales [4][6]. - Operating cash flow increased by 21% sequentially and over 300% year-over-year due to inventory normalization, enabling investments in next-generation technology [5][6]. Market Guidance - The company's Q3 revenue guidance is approximately 500 basis points above consensus estimates, prompting analysts to raise their forecasts and price targets, indicating a strong market tailwind [2][3]. - Micron's guidance suggests a return to record revenue and wider margins for the year, primarily from DRAM and NAND markets [6]. Analyst Sentiment - Analysts have responded positively to Micron's results, with numerous price target increases, suggesting a 35% upside potential from the current price [3][4]. - Despite a current Moderate Buy rating, Micron is not among the top stocks recommended by leading analysts [9]. Balance Sheet Health - Micron's balance sheet shows a 7.7% increase in equity, with stable cash balances and low leverage, indicating financial health as the year progresses [7].