Micron Revenue Surges 346%, Igniting Stock Price, Rising Nearly 20% in Overnight Trading. JPMorgan and Goldman Sachs Both Sharply Raise Price Targets

TradingKey - After the U.S. market close on June 24, after Micron Technology ( MU) released its earnings report, JPMorgan Chase ( JPM) immediately raised its price target from $550 to $1,540, maintaining an 'Overweight' rating. This near-twofold upward adjustment reflects the bank's strong recognition of Micron's explosive earnings growth potential. Analyst Harlan Sur's upgrade was based on Micron's third-quarter revenue, gross margin, and earnings per share all exceeding expectations.

Meanwhile, several investment banks simultaneously followed suit in raising their price targets: D.A. Davidson lifted its price target from $1,500 to $2,000, and Susquehanna raised theirs from $1,750 to $2,000.

Goldman Sachs ( GS) analyst James Schneider raised the price target from $900 to $1,100, maintaining a 'Neutral' rating. Goldman Sachs believes that Micron's strong earnings and better-than-expected guidance will support further upside in the stock price. The firm holds a positive view on the disclosure of long-term agreements, believing they will help raise the P/E multiple based on peak earnings that investors are willing to pay. Goldman Sachs also noted that the risk-reward ratio is roughly balanced at current levels, and would consider a more constructive stance if industry supply growth discipline can be maintained through 2028 and beyond.

Micron Earnings Data

Micron's third-quarter revenue reached $41.46 billion, up 346% year-over-year and 74% quarter-over-quarter, beating analysts' expectations of $35.84 billion and marking the fifth consecutive quarter of record revenue. Adjusted EPS was $25.11, exceeding the expected $20.78, while the adjusted gross margin reached an astonishing 84.9%.

Data center revenue grew from $1.53 billion in the same period last year to $11.5 billion. HBM revenue exceeded $1 billion for the second consecutive quarter. Cloud storage revenue was $13.77 billion, with a gross margin of 83%.

Management stated that HBM supply tightness will continue past 2027, with supply improvement not expected until 2028. Micron has signed 16 three-to-five-year long-term purchase agreements with data center operators and automakers, and the CEO noted that about half or more of its revenue will come from these customers once the agreements are fully effective.

Fourth-quarter guidance: Revenue is projected at $49 billion to $51 billion, beating market expectations of $43.24 billion; adjusted EPS is expected to be $30 to $32, exceeding the estimated $25.31.

Post-market reaction

Following the release of its earnings report, Micron's stock price surged, rising over 15% in after-hours trading to around $1,213.96, after closing at $1,048.51 in regular trading. During overnight trading, it even surged over 19% at one point. As of press time, Micron's overnight stock price stood at $1,242.28, up 18.48%.

[Micron Overnight Stock Price Trend, Source: Futu]

Memory Giants SK Hynix and Kioxia Seek US Listings in Succession

SK Hynix has filed for a U.S. IPO under the ticker "SKHY," planning to raise approximately 45.45 trillion Korean won (about $29.4 billion) through ADRs, with an expected listing on July 10. Japanese NAND flash giant Kioxia is following closely behind, planning to list ADRs in the U.S. in April or May next year.

As SK Hynix and Kioxia successively list in the U.S., joining Nasdaq-listed Micron Technology, SanDisk ( SNDK ), Western Digital ( WDC ), and Seagate ( STX ), global memory chip giants will compete on the same stage in the U.S. capital markets.