Could Micron Technology Stock Make You a Millionaire in 2026?

When it comes to big tech, Micron Technology (NASDAQ: MU) has often been overshadowed by more popular hardware companies like Nvidia or Apple. That said, the rise of generative artificial intelligence (AI) has given the computer memory specialist its big break. With Micron's shares up by a whopping 254% over the last 12 months, Wall Street is taking notice. Let's dig deeper to decide if the stock still has millionaire-maker potential.

Why Micron?

While the AI hardware story has usually focused on graphics processing units (GPUs), which do the brunt of model training and inference, these chips can't work without the support of other types of hardware. Micron contributes to the industry by providing the memory chips needed to store training data and provide working memory for inference, which is how large language models (LLMs) analyze and answer user queries.

According to analysts at Goldman Sachs, cloud computing giants are expected to spend an eye-popping $527 billion on capital expenditures related to their data center buildouts. Investors should expect some of that money to go to memory chips. Industry observers estimate that AI companies could scoop up 70% of production in 2026, and this will allow companies like Micron to raise prices across their product portfolios.

The surge in AI demand is already boosting Micron's operational performance. In the fiscal first quarter (which ended in December), the company's total sales rose by 57% year over year to $13.6 billion, with most of the growth concentrated in the cloud services division, where it serves AI data centers. The momentum is expected to continue for the next few years, with management projecting the total addressable market for its high-bandwidth memory devices to reach $100 billion by 2028, growing at a 40% compound annual growth rate (CAGR).

What comes next?

Image source: Getty Images.

While Micron is doing well now, that doesn't mean it won't face challenges in the future. The memory industry is notoriously cyclical because the chips are somewhat commoditized, and when demand rises, producers usually increase capacity until prices fall. That said, investors may be able to rest easier knowing that Micron can use the current windfall for buybacks that will reduce the number of shares outstanding, helping boost the stock's value relative to earnings, even if growth slows down.

Micron spent a relatively modest $300 million on share repurchases in the fiscal first quarter (which ended in December). But investors can expect this number to increase over time because of its rapidly improving cash situation. Management reported a whopping $3.9 billion in adjusted free cash flow in the period, leaving plenty of money to be reinvested in growing production capacity while returning value to shareholders.

Despite the impressive revenue growth and cash flow, Micron's shares trade for a forward price-to-earnings (P/E) multiple of just 11.5. That's a substantial discount compared to the S&P 500 average of 22 and AI hardware alternative Nvidia, which boasts a forward P/E of 24.

Can Micron make you a millionaire?

If you had put $50,000 in Micron stock five years ago, you would have a position worth roughly $228,000 today. That means the company is well on its way to making millionaires out of investors who got in before the generative artificial intelligence boom. With shares still valued far below the market average, there is plenty of room for continued expansion.

All that said, Micron is now a $437 billion company, which naturally limits how much it can realistically grow relative to when it was smaller. While the company is still capable of market-beating growth, investors should maintain a long-term horizon -- allowing the company's massive buybacks to steadily reduce the share count and boost earnings per share over time -- rather than expecting explosive short-term appreciation.

Will Ebiefung has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Goldman Sachs Group, Micron Technology, and Nvidia. The Motley Fool has a disclosure policy.