Here's What a $10,000 Investment in Micron Stock Could Be Worth in 2028 (Hint: Big Gains Ahead)

Micron (NASDAQ: MU) is an interesting stock. At face value, it has had a great 2026, up 140%. However, if you look at the stock's valuation, some investors may be disappointed in those returns, as they could easily be far higher.

The reality is that the market isn't valuing Micron's stock as highly as it maybe should, and if Micron does the right thing, shareholder returns could explode over the next two years.

I think a $10,000 investment in Micron stock today could be worth $50,000 by 2028. How? The memory chip market just needs to stay strong.

Image source: The Motley Fool.

Memory chips are in high demand and short supply

Micron makes memory chips, but the AI build-out has soaked up all available production capacity. In fact, Micron told investors that market conditions will be worse in 2027 and 2028 than they were in 2026. While that may be bad news for their customers, it's great news for Micron, as memory chip prices will remain elevated.

However, Micron is doing everything it can to increase output. In 2027 and 2028, it plans to have six new production facilities up and running worldwide. The question is, will that be enough? After all, the AI build-out is expected to intensify through 2030. With memory chip production capacity already expected to be sold out for the next couple of years, it's not far-fetched to see more announcements about being sold out in 2029 or 2030. That will keep prices high, benefiting Micron.

The high prices have already caused Micron's profits to reach all-time highs. With the chip shortage likely lasting for many more years, this likely won't change anytime soon.

MU Gross Profit Margin data by YCharts.

The combination of soaring revenue and record margins has also led to huge growth for Micron.

MU EPS Diluted (Quarterly YoY Growth) data by YCharts.

Times have been good for Micron, and they will likely stay that way for a couple of more years. That gives the stock plenty of time to deliver strong returns, but how will it do it?

Micron's returns will come from three places

The first place returns will come from is obvious: outright growth. With Micron standing up new production facilities, it will be able to rapidly grow its revenue based on sheer volume.

The second place will be share buybacks or dividends. Because Micron has grown so much, it has more cash than it knows what to do with.

MU Free Cash Flow data by YCharts.

Micron is now producing nearly $60 billion in free cash flow each quarter, and it could use those funds to repurchase shares. This would make each share more valuable and increase earnings per share. If Micron can sustain this business over multiple years, the share buyback opportunity could be immense, especially given how cheap its stock is.

The last factor is stock valuation. Micron's stock is valued at a pretty cheap level, trading for just 12 times earnings and five times future earnings.

MU PE Ratio (Forward) data by YCharts.

That's a very cheap level, and if Micron's stock can rise to its normal 20 to 25 times earnings and hit expectations, that would indicate the stock could quadruple, turning a $10,000 investment into $50,000. That's a huge gain, and that's really only 2027's growth.

Extending this projection to 2028 gives the market more time to properly value Micron's stock. Furthermore, it may be clear that AI demand will last longer than expected, making the growth case even stronger. With Micron likely to repurchase shares, this could turn into a major gain for investors, and buying the stock now makes a ton of sense for long-term AI investors.

Keithen Drury has positions in Micron Technology. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool has a disclosure policy.