Nvidia Stock Is Up 43% in 2025, but Here's Another Super Semiconductor Stock to Buy in 2026, According to Certain Wall Street Analysts

Core Viewpoint - Investors are encouraged to explore semiconductor stocks beyond Nvidia, particularly those with strong AI fundamentals and reasonable valuations, as Nvidia's stock may face modest growth despite its current popularity and market position [1][2]. Nvidia Overview - Nvidia's shares have surged over 43% in 2025, driven by high demand for its Blackwell architecture systems and software solutions, but its market capitalization exceeds $4.6 trillion with shares trading at nearly 30 times forward earnings, indicating that much of the optimism is already priced in [2]. - Nvidia's revenue is heavily reliant on a few hyperscaler customers, with two customers accounting for 39% and four for 46% of its revenues in Q2 of fiscal 2026, posing a concentration risk as these clients may develop proprietary chips [4]. Micron Overview - Micron's shares have increased nearly 128% in 2025, reflecting growing investor confidence in its high-bandwidth memory and data center portfolio, suggesting potential for higher returns in 2026 [3]. - Micron's revenue base is more diversified compared to Nvidia, with its largest customer accounting for only 17% of total revenue and the next largest contributing 10% in fiscal 2025, which enhances its resilience in the current economy [5][6]. - Micron's high-bandwidth memory (HBM) revenues reached nearly $2 billion in Q4 of fiscal 2025, indicating a strong demand for its products in data centers [7]. - The company expects its HBM market share to align with its overall DRAM share by Q3 of fiscal 2025, and it has begun sampling HBM4 products, with production shipments expected in Q2 of calendar year 2026 [8]. Market Position and Valuation - Micron's data center business accounted for 56% of its total sales in fiscal 2025, positioning the company well to capture significant AI-powered memory demand in the coming years [9]. - Micron trades at 12.3 times forward earnings, significantly lower than Nvidia's valuation, suggesting a stronger risk-reward proposition as Micron's improving revenue mix towards high-margin AI memory products may lead to valuation expansion [10]. - Analysts have upgraded Micron's stock ratings, with target prices raised significantly, indicating positive sentiment in the market [11]. - Expected earnings per share for Micron in fiscal 2026 is nearly $16.6, with potential share price growth ranging from 6% to 37.8% based on valuation multiples [12]. - In contrast, Nvidia faces a higher probability of valuation compression, suggesting that Micron may be the better semiconductor investment choice for 2026 due to its diversified customer base and reasonable valuation [13].