Micron (MU) stock is charging higher on Tuesday as UBS analysts led by Timothy Arcuri nearly tripled their price target on the memory chips specialist to $1,625.
The upward momentum pushed MU’s market cap above the coveted $1 trillion mark, making it the 11th U.S. company to have hit that milestone.
Year-to-date, Micron stock is up an exciting 185% as artificial intelligence (AI) tailwinds continue to pour capital into the memory-centric names.
UBS Sees Micron Stock as Undervalued
Even after the explosive surge, MU shares are going for less than 13x forward earnings at writing, which represents a significant discount to Nvidia (NVDA) at about 27x.
However, there’s every reason for Micron to command a similar price-to-earnings (P/E) multiple as NVDA.
Why? Because memory has evolved from a cheap commodity into the core bottleneck of artificial intelligence infrastructure, the UBS analyst told clients in a research note today.
Timothy Arcuri’s upwardly revised price target suggests Boise-headquartered Micron Technology Inc could nearly double again over the next 12 months.
And technicals substantiate his view; MU currently sits decisively above its key moving averages (MAs), indicating a strong uptrend that’s unlikely to fade in the absence of a meaningful catalyst.
LTAs to Drive MU Shares Higher in 2026
UBS now sees Micron’s cumulative free cash flow between 2027 and 2029 to hit an astronomical $400 billion, with annual per-share earnings (EPS) scaling past $100.
Analyst Timothy Arcuri is particularly constructive on the company’s new enhanced LTAs, which offer higher cross-cycle ROIC and “improved visibility into now-committed customer demand.”
Because MU’s high-bandwidth memory (HBM) is sold out through 2026, these long-term contracts guarantee a high earnings floor, shielding the firm from the brutal downcycles of the past.
Note that Micron shares pay a small dividend as well, which makes them even more attractive as a long-term holding.
Micron Remains Buy-Rated Among Wall Street Firms
Heading into Tuesday, Wall Street had a consensus “Strong Buy” rating on MU stock with a mean price target of roughly $628.
However, it’s reasonable to assume that upward revisions like that of UBS may follow in the weeks ahead.
On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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