Better Artificial Intelligence (AI) Buy: Micron Technology vs. Sandisk

Micron (NASDAQ: MU) and Sandisk (NASDAQ: SNDK) are two of the most popular investment options in the market right now. They both rocketed higher in the first half of 2026 but have since given back some of those gains and are now each down significantly from their all-time highs.

With Micron down 20% and Sandisk down over 30%, now could be your time to get in on these two memory chip giants before they rocket higher. But if you could only buy one of these, which one makes the most sense? Let's take a look.

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Micron operates in both segments of the memory chip market

While memory chips are a broad description, there are really two primary types of memory utilized in data centers (the reason for the boom in memory chip demand). DRAM memory is used alongside computing units for rapid data access, while NAND memory is used for long-term storage in devices like solid-state drives (SSDs). Micron makes both NAND and DRAM memory, while Sandisk only makes NAND.

Demand for each of these types of memory chips has been stable over the past year, and companies in both industries have struggled to meet demand from artificial intelligence (AI) hyperscalers. With increased data center expansion coming over the next few years, this bodes well for Micron's and Sandisk's futures.

There isn't a ton to separate one memory chip producer from another, so the product acts more like a commodity. When a commodity has a limited supply and high demand, the price skyrockets, and that's exactly what we're seeing with these two.

That also opens up a different fear for investors: cyclicity. Eventually, memory chip demand will fall, or supply will rise to a more reasonable level, leading to lower prices. If that occurs, all the revenue and profits Sandisk and Micron investors have come accustomed to could plummet, taking the stocks with them.

As a result, the market may be a bit overcautious with these two, as nobody knows when the cycle will turn. However, Micron informed investors that they see memory chip market tightness persisting beyond 2027 -- leaving at least a year and a half of strong growth for these two. That makes them viable investments, but which is the better buy now?

Each is rapidly growing

Both companies have seen their revenue and profits skyrocket over the past year, with Micron's growing at a faster pace overall than Sandisk's.

SNDK Revenue (Quarterly YoY Growth) data by YCharts

Micron's fiscal year (FY) wraps up in August, so utilizing next year's projections is a smart move for investors. From that standpoint, Wall Street analysts expect 81% revenue growth during FY 2027. Sandisk's fiscal year ended in June, and analysts estimate 154% revenue growth during FY 2027.

So, just because Micron has dominated the past few months doesn't mean Sandisk won't come roaring back. Still, each of these companies expects significant growth over the next few quarters, yet their stocks are trading at pretty low levels.

Sandisk trades for 7.5 times FY 2027 earnings, and Micron trades for 6.3 times FY 2027 earnings. The low prices suggest the market is skeptical of the long-term viability of the memory chip boom. Still, with industry experts calling for years of memory chip shortage, I think I'm OK taking a risk on these two, as the upside is immense if the long-term outlook is positive.

But between the two, I think Sandisk makes the most sense. It has a similarly low price to Micron but is expected to grow at a far faster rate. If I'm taking a chance on these two, it might as well be on the one with the higher growth rate projection. Still, I think Micron is an OK pick too -- it just may not see as great a return as Sandisk.

Keithen Drury has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool has a disclosure policy.