Looks like Micron’s (NASDAQ:MU) epic run is set to continue as the shortened week kicks into action. The shares are surging in pre-market after one of the Street’s most prominent analysts raised his price target to a new Street-high.
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Discover why XOVR identified Kalshi as an attractive private investment opportunity.That would be UBS’s Timothy Arcuri, who ranks in 2nd spot among the thousands of Wall Street stock pros. Along with reiterating a Buy rating, Arcuri raised his price target from $535 to $1,625, suggesting the stock will gain another 116% over the next 12 months. (To watch Arcuri’s track record, click here)
With LTAs (long-term agreements) now established across most of the industry, Arcuri says he has once again increased his C2027–2029 estimates and continues to expect EPS to stay comfortably above $100 throughout the period, with Micron generating more than $400 billion in free cash flow over the same timeframe. “We believe the market will start to put a more ‘normal’ multiple on the stock and MU will continue to re-rate higher as more details emerge about the structural changes AI has driven to the entire memory complex,” the 5-star analyst went on to say.
Arcuri’s supply chain analysis of LTAs in the memory sector indicates that as much as 30% of DDR volumes industry-wide will soon be locked in at pricing only marginally below current levels. These agreements should enable MU to exchange some near-term revenue for greater demand visibility and a “smoother earnings profile.” As a result, Arcuri has increased EPS estimates for C27/28/29E to $155/$167/$117, compared with $133/$122/$77 previously, and given that investors typically assign a premium to “durability and visibility,” he sees MU’s EPS staying above $100 through C2029E, as “testament to the sort of lasting, structural change that should support a shift toward a broader semi multiple.”
Arcuri now anticipates the DRAM market will stay undersupplied through at least C2Q28 (previously C4Q27) and NAND undersupply to persist until C4Q27 (previously C3Q27). Additional upside vs. his prior model is driven by higher HBM ASP ($/GB) assumptions, a point the analyst highlighted in early April, as Micron, SK Hynix, and Samsung aim to re-establish a pricing premium for HBM into C2027. As a result, he now assumes MU HBM ASP up around 50% year-over-year compared to 35% previously, while keeping MU HBM bit shipment assumptions unchanged at 7.78 billion Gb for C2026 and 12.05 billion Gb for C2027.
Into C3Q26, his industry model also reflects the impact of LTAs, primarily seen in stronger contract pricing for DDR (up ~8% quarter-over-quarter) and NAND (up ~9% QoQ). This suggests sequential pricing growth moderating back toward the low single-digit range after three consecutive quarters of increases averaging more than 50%.
So, that is the UBS view, but what does the rest of the Street have in mind for Micron? 26 other analysts join Arcuri in the bull camp, while 3 additional Holds can’t detract from a Strong Buy consensus rating. However, the $657.41 average price target now sits 12% below the current share price. Given this discrepancy, watch out for further price target hikes or rating downgrades shortly. (See Micron stock forecast)
Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.