AI-Focused DRAM ETF More Than Doubles Since April Debut As Micron, SK Hynix Stocks Cross $1 Trillion Together: Retail Traders Pile In

• Micron achieved a $1 trillion market capitalization on Tuesday; the stock rose a further 6% in overnight trading
• SK Hynix and Samsung shares gained sharply in Wednesday trading in Seoul.
• Stocktwits sentiment for MU and DRAM went up a level to ‘neutral.’

The memory supercycle was in full display as the new week kicked off after the Memorial Day holiday. 

The Roundhill Memory ETF (DRAM), the newly launched memory-sector fund, surged 14.6% to another record high on Tuesday. The rally marked the fund’s biggest single-day gain and pushed its advance since its April 2 launch to 107%.

Micron, the memory-chip maker at the center of the sector’s rally, jumped 19.3% after UBS said the stock could rally 80% higher from current levels in what was Wall Street’s most bullish call on the stock yet. That helped Micron’s market capitalization soar to $1.01 trillion for the first time.

The optimism spilled over globally, with Micron’s South Korean rival SK Hynix rising more than 10% in Seoul trading on Wednesday and also crossing the $1 trillion market capitalization mark. Samsung, which recently reached a last-minute pay deal with its workers to avert a major strike, was up 6.4%.

SK Hynix, Samsung, and Micron are the three largest components of the Roundhill Memory ETF. In overnight trading ahead of Wednesday, MU rose a further 6%, while DRAM was up 3%.
 

Memory Supercycle

A massive buildout of AI data centers has triggered surging demand for memory chips, driving multifold growth in revenue and stock prices for the industry’s top producers. The boom has also led to shortages and sharply higher prices, with some experts warning that memory chips could emerge as the key chokepoint in the global AI buildout, forming a critical bottleneck for data-center expansion.

Micron shares have surged 214% year to date, while Seagate and Western Digital have also more than doubled. While companies and market analysts have indicated that elevated demand is likely to persist in the coming years, the debate has now shifted to whether — and by how much — memory stocks can continue their run.

Analysts, on average, project a pullback in MU, STX, WDC and SNDK stocks, according to their consensus estimates on Koyfin.

What Did UBS Say About MU?

On Tuesday, UBS bumped its price target on MU to $1,625 from $535. That’s the most bullish call on the stock, with the new target implying an 80% upside from the last close. The average analyst price target for MU is $640.48, according to Koyfin.

UBS said Micron is expected to benefit from long-term memory supply agreements that could lock in pricing and demand visibility across much of the industry, supporting significantly higher earnings and free cash flow forecasts through 2029 as AI-driven structural changes improve the durability and stability of the memory market, according to TheFly.

“We believe the market will start to put a more 'normal' multiple on the stock, and MU will continue to re-rate higher as more details emerge about the structural changes Al has driven to the entire memory complex,” UBS said in its research note.

UBS also expects the company's earnings per share to exceed $100 at least until 2029, supported by its long-term agreements. The firm maintained its ‘Buy’ rating and set a price target of $1,625, up from $535, implying more than 113% upside based on the stock’s Friday closing price.

Retail View On MU, DRAM

MU was the top-trending ticker on Stocktwits late Tuesday, with message volume over the past 24 hours surging more than 1,000%. Retail sentiment improved to ‘neutral’ from ‘bearish,’ although anecdotal commentary suggested confidence remained elevated.

“$MU I've been in this game for long enough to know that after popping 20%, you should NOT sell for profits. In fact, there's this thing called MOMENTUM that will push this stock even higher. This wont be under 1000 this week,” a trader wrote.

DRAM “managed to push back yet again to new record highs, surpassing the last 2 weeks of trading on a pickup in volume,” said Mark Newton, managing director and global head of technical Strategy for Fundstrat Global Advisors. “While stocks like $MU have gotten ridiculously overbought, weekly charts have not signaled any technical signs yet of this starting to reverse course.”

The retail sentiment for DRAM also improved to ‘neutral’ from ‘bearish,’ with watchers on Stocktwits rocketing by over 900% in the past month. A trader remarked: “$DRAM SK Hynix is up over 10% in Korea tonight. DRAM will hit 70 tomorrow.”

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