Micron Technology, Inc. (MU): A Bull Case Theory

We came across a bullish thesis on Micron Technology, Inc.  on Value investing subreddit by bodaflack. In this article, we will summarize the bulls’ thesis on MU. Micron Technology, Inc. 's share was trading at $117.68 as of August 22^nd. MU’s trailing and forward P/E were 21.20 and 8.98 respectively according to Yahoo Finance.

Micron Technology, Inc. (MU) appears significantly undervalued despite strong operational and financial momentum. The company recently guided Q4 EPS to $2.85 ± $0.07, which implies FY2025 forward earnings of $8.11, translating to a P/E of just 14.9. Analysts who updated their price targets post-guidance see substantial upside, with JPM at $185, Needham at $150, and Rosenblatt at $200. Looking further ahead, FY2026 forward P/E is expected to compress further to 8–9, reflecting an extremely low PEG of 0.13 and an EV/EBITDA of 8.5.

Micron maintains a strong balance sheet with $15.7 billion in liquidity, supporting both growth initiatives and shareholder returns. Revenue growth has consistently exceeded 35% year-over-year, with top-line and bottom-line metrics driving substantial cash flow from operations. In Q3 alone, the company generated $3.1 billion in free cash flow, sufficient—under conservative assumptions—to repurchase every share in roughly ten years while maintaining aggressive CAPEX investments.

Micron’s growth trajectory is further supported by secular tailwinds in High Bandwidth Memory (HBM), which is projected to expand at a 30–35% CAGR through 2030, closely aligned with datacenter demand. The company is already sold out of its 2025 HBM supply and is accelerating fab construction to meet future demand, including a $200 billion U.S. investment plan backed by the federal government, with $150 billion earmarked for manufacturing and $50 billion for R&D.

The Idaho fab, set to come online in 2H 2027, is progressing on schedule. Despite the high-capex nature of the semiconductor business, Micron is executing effectively, generating substantial cash flow to fund expansion while returning significant capital to shareholders, making it a compelling value investment with strong upside potential.

Previously we covered a bullish thesis on Micron Technology, Inc. (MU) by Oliver | MMMT Wealth in April 2025, which highlighted strong revenue and EBITDA growth, technological leadership in AI memory, and attractive valuation multiples. The stock has appreciated approximately 67.5% since our coverage as growth trends continued. bodaflack shares a similar bullish view but emphasizes recent guidance, HBM demand, and the $200 billion U.S. investment plan as key new catalysts.

Micron Technology, Inc.  is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 96 hedge fund portfolios held MU at the end of the first quarter which was 94 in the previous quarter. While we acknowledge the potential of MU as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.