Why Micron Stock Popped Today
Key Points
Bernstein SocGen Group analyst Mark Li raised his price target on Micron stock this morning.
DRAM prices are rising, and may keep on rising throughout 2026.
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Micron (NASDAQ: MU) stock started off the New Year right, soaring 7.5% through 10:25 a.m. ET Friday, and you can thank Bernstein SocGen Group analyst Mark Li for that.
In a note released this morning, Li raised his price target on the semiconductor computer memory stock to $330, with an "outperform" rating.
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Micron Q1 earnings
Li bases his higher price target on the data Micron delivered in its fiscal Q1 2026 earnings report two weeks ago. In that report, Micron delivered an astounding 56% increase in quarterly revenue to $13.6 billion, and a 175% increase in earnings per share to $4.60.
CEO Sanjay Mehrotra boasted of "record revenue and significant margin expansion," setting "substantial records across revenue, gross margin, EPS, and free cash flow." Barely positive on free cash flow in Q1 2025, Micron's cash profit in the first quarter of the new fiscal year surged past $3 billion.
What Bernstein says about Micron
Li predicts Micron will continue to do well as DRAM prices keep rising in 2026, and "as AI makes data center demand balloon but supply expansion takes time." The analyst predicts that Q2 results will show a 20% to 25% sequential increase in DRAM prices, and believes prices will continue to rise "throughout 2026."
Still, Li notes that Micron's own Q2 guidance "suggests even stronger price increase in the near term." At last report, the company was expecting to book $18.7 billion in revenue in fiscal Q2, plus or minus $400 million, with approximately 67% gross margins and profit per share of $8.19, plus or minus $0.20.
These are big numbers, though, and Li's main worry at this point is that Micron stock could be punished if management gets too excited, overpromises... and underdelivers.
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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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