One of the biggest success stories in the stock market this year has been Micron Technology (MU). The company makes computer memory and storage - the very products that have been in high demand this year due to the explosive build-out of artificial intelligence data centers.
Micron Technology stock is up 247% so far this year, which is the second-best performance in the entire S&P 500 Index ($SPX). This pushes Micron to join the exclusive trillion-dollar club in its market capitalization. Having Micron in your portfolio can lead to dynamic returns, whether you’re just starting out or if you’re a seasoned pro. Bloomberg News recently reported that the Appaloosa Management hedge fund run by David Tepper returned 32% in the first half of the year, with memory chip stocks like Micron leading the way.
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Let’s take a closer look at Micron and see why it’s growing so fast this year.
About Micron Technology
Micron, which is headquartered in Boise, Idaho, has grown to a market capitalization of $1.07 trillion. The company makes NAND and DRAM memory, both of which are essential for modern computing. DRAM, or dynamic random-access memory, functions as a device’s short-term memory space, working with apps and programs that are currently in use. NAND memory is for long-term storage of files.
While you use NAND and DRAM memory in your personal computer, both are also essential for data centers. And as demand for storage has grown, both consumers and data center operators are seeing demand spike and prices rise.
All of these are great tailwinds for Micron and other memory stocks. In fact, the entire sector is seeing great returns this year. SanDisk (SNDK) is up 682.8%, Western Digital (WDC) is up 235.6%, and Seagate Technology (STX) is up 223%.
But here’s what really stands out. Even with Micron’s huge run-up, the stock is still shockingly affordable. The forward price-to-earnings ratio is only 12.86 times, which is a bargain, especially when you consider the forward price-to-earnings of the S&P 500 Index ($SPX) is around 21 times right now.
www.barchart.com Micron Beats on Earnings
Micron’s earnings report for the fiscal third quarter (ending May 28) was a landmark moment for the company. Revenue more than quadrupled from a year ago, reaching $41.46 billion, and net income was $28.24 billion, up from $1.88 billion a year ago. Micron reported earnings per share of $24.67, which topped estimates of $20.98. A year ago, EPS was only $1.68 – so Micron had a year-over-year (YOY) improvement of $1,369%.
Micron reported massive growth across the board, with operating margins also increasing dramatically.
| Segment | FY 2026 Q3 Revenue | FY 2026 Q3 Operating Margin | FY 2025 Q3 Revenue | FY 2025 Q3 Operating Margin |
| Cloud Memory | $13.76 billion | 78% | $3.38 billion | 46% |
| Core Data Center | $11.524 billion | 87% | $1.53 billion | 38% |
| Mobile and Client | $11.521 billion | 87% | $3.25 billion | 24% |
| Automotive and Embedded | $4.63 billion | 79% | $1.12 billion | 26% |
Source: Micron
“Micron’s record fiscal Q3 financial results and even stronger outlook for Q4 reflect the strategic value of memory in the AI era,” CEO Sanjay Mehrotra said. “Micron is investing at record levels in technology, products and supply to address our customers’ rapidly growing demand.”
Micron issued guidance of $49 billion to $51 billion in revenue for the fiscal fourth quarter, with earnings per share in a range of $29.73 to $31.73.
What Do Analysts Expect for MU Stock?
Considering Micron’s business opportunity, the extremely low valuation, and its year-to-date (YTD) performance, it is difficult to find any analyst who is bearish on Micron stock. Forty-one analysts who cover the stock have a consensus “Strong Buy” rating, with only four recommending a “Hold.” The mean price target of $1,487.65 represents potential upside of 50%, and the most bullish target suggests that Micron stock could nearly double from here.
www.barchart.com The Wrap-Up
Will Micron’s run continue? The answer is - more than likely. Data center spending is accelerating this year and is expected to go even further in 2027. But it doesn’t matter how much a company spends on AI computing capacity if it doesn’t have the memory in place.
Micron is an ideal tech stock for portfolios today, and a great candidate for a potential stock split now that the stock price has crossed $1,000 per share.
On the date of publication, Patrick Sanders 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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