- Barclays analyst Tom O’Malley sharply boosted his price target to $675 from $450.
- Micron shares slipped as investors weighed concerns about the peak cycle.
- Deutsche Bank dismissed those concerns as premature, emphasizing strong demand for DRAM and NAND.
Micron Technology Inc. (MU) has seen a series of bullish analyst revisions following a standout second-quarter earnings report, even as investor sentiment remains cautious about the semiconductor cycle's durability.
The memory chip-maker posted a second-quarter (Q2) revenue of $23.86 billion with an earnings per share (EPS) of $12.20, both surpassing the analysts’ consensus estimates of $19.18 billion and $8.66, respectively, according to Fiscal AI data.
Micron expects its third-quarter (Q3) 2026 revenue to reach roughly $33.5 billion, with a possible variation of $750 million on either side. The company also projected EPS of about $19.15, with a margin of error of $0.40.
UBS Sees Long-Term Deals Driving Balance Sheet Growth
UBS increased its price target to $510 from $475, citing continued earnings outperformance and improved guidance, according to TheFly. The new price target implies a potential upside of over 10% from Wednesday’s closing level. The firm highlighted expectations for gross margins exceeding 80% and noted that new long-term customer agreements could stabilize profitability over time.
UBS also projected significant balance sheet strength, estimating that tangible book value per share could climb sharply alongside substantial cash accumulation.
Micron stock traded over 5% lower in Thursday’s premarket. On Stocktwits, retail sentiment around the stock changed to ‘bullish’ from ‘extremely bullish’ territory the previous day amid ‘extremely high’ message volume levels.
Barclays Sees Structural Shift
Analyst Tom O’Malley at Barclays sharply boosted his price target to $675 from $450. He pointed to revenue guidance far exceeding consensus forecasts and margin projections, signaling a structural change in the company’s earnings potential.
Barclays now anticipates Micron could generate $100 in EPS in 2027, marking a major upward revision to prior assumptions.
Despite the strong outlook, the stock pulled back following the earnings. Deutsche Bank acknowledged the market’s hesitation, attributing it to fears that the memory chip sector may be approaching its cyclical peak.
However, the firm dismissed those concerns as premature, emphasizing that demand for DRAM and NAND technologies is expected to expand at rates exceeding historical trends.
MU stock has gained over 61% year-to-date.
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