Bull of the Day: Micron Technology (MU)

Micron Technology (MU) has emerged as one of the key beneficiaries of the ongoing AI data center buildout. While companies like Nvidia (NVDA) supply the GPUs that power artificial intelligence models, Micron provides another critical ingredient: memory and storage. As AI workloads grow exponentially, the demand for high-bandwidth memory (HBM), DRAM, and NAND flash has become just as important as processing power, making Micron an up-and-coming player in the AI infrastructure ecosystem.

Shares of Micron are now among the top ten performing stocks in the S&P 500 for 2025, yet the setup remains attractive. The stock endured heavy selling pressure in late 2024 and early 2025, but the rebound off those lows has left MU trading at a reasonable valuation relative to its growth prospects. In fact, analysts project robust earnings acceleration ahead, supported by rising AI-related demand and the recovery of broader memory markets. The stock currently holds a Zacks Rank #1 (Strong Buy) thanks to a steady stream of upward earnings estimate revisions.

Memory plays a vital role in AI data centers. GPUs can only perform at peak efficiency when paired with vast amounts of high-speed memory to handle the enormous datasets required for training and inference. Micron’s leadership in HBM3E and next-generation DRAM positions it to capture significant market share as hyperscalers and enterprises race to expand AI capacity.

With its improving fundamentals, strong technical momentum, and critical role in the AI boom, Micron Technology looks like a compelling investment option at current levels, with room for further upside as the cycle continues to strengthen.

Micron Technology Shares Rally on Upgrades

Micron Technology’s increasingly important role in powering AI infrastructure has caught the attention of Wall Street. Analysts have responded with a wave of optimism, unanimously raising earnings estimates across timeframes and giving the stock to a Zacks Rank #1 (Strong Buy). Over just the past two months, current quarter EPS projections have surged 13.6%, while FY26 estimates are up 6.4%.

The growth outlook is nothing short of explosive. Annual revenue is projected to jump 47% this year and another 34% next year, fueled by soaring demand for high-bandwidth memory (HBM) and advanced DRAM used in AI servers. On the bottom line, Micron is expected to swing sharply higher, with earnings forecast to grow 525% this year and 60.8% in FY26.

Equally compelling is the valuation backdrop. Despite its rally, MU shares now trade at just 10.7x forward earnings, a stark discount compared to many other AI-related semiconductor peers. For investors, this combination of surging growth, analyst upgrades, and discounted valuation makes Micron look like one of the most attractive opportunities in the sector.

Should Investors Buy Shares in Micron Technology?

Micron Technology has firmly established itself as a core enabler of the AI boom. The company’s products are essential for unlocking the full potential of GPUs, making it a critical piece of the data center buildout that is expected to drive trillions of dollars in investment over the next decade.

What makes the story even more compelling is the alignment of factors, including massive earnings growth, strong analyst revisions, and a valuation that still sits at a discount to peers. Few companies can boast earnings expected to rise more than 500% this year, yet still trade at barely 11x forward earnings. That disconnect highlights just how much runway Micron may still have, even after its sharp rebound off 2025 lows.

For investors looking for a way to participate in the AI boom beyond the headline GPU names, Micron offers a unique opportunity. With strong momentum at its back, a leadership position in high-bandwidth memory, and a supportive industry cycle, Micron Technology looks well-positioned to continue climbing higher.

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This article originally published on Zacks Investment Research (zacks.com).

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