Micron (MU) in Focus as Analysts Highlight Multi-Year AI Data-Center Expansion

Core Viewpoint - Micron Technology, Inc. is experiencing a positive outlook driven by AI demand, with Morgan Stanley raising its price target significantly from $180 to $325, indicating confidence in the memory cycle's next phase [1][4]. Group 1: Stock Performance and Market Dynamics - Recent stock strength reflects extreme fluctuations in DRAM pricing, with an estimated 30% of end demand currently unmet due to severe supply constraints [2]. - The normalization of these supply-demand imbalances is expected by mid-2026 as new production capacity becomes available [2]. Group 2: Long-term Growth and Investment Strategy - The long-term investment thesis is centered on a multi-year data center expansion cycle driven by AI workloads, with memory suppliers preparing for increased data center capacity [3][4]. - The company anticipates that as new capacity comes online, supply dislocations will normalize, leading to increased operating profits [4]. - The investment strategy suggests buying during pullbacks, viewing sell-offs as opportunities rather than exit signals, with a bullish outlook based on rising supply indicative of sustained demand from AI data centers [4]. Group 3: Financial Projections - Earnings estimates have been raised, with the new price target of $325 based on a 13x EPS multiple over a projected revenue of $76 billion for CY27 [4]. - Further revenue and EPS expansion is expected into 2028, reflecting confidence in the ongoing demand from cloud service providers [4].