Micron (MU) is the smallest of the “big three” in AI memory chips, behind Samsung Electronics and SK Hynix. While Micron may command a much smaller market size, the company’s stock value has skyrocketed over the last year. Let’s discuss what it would take for Micron stock to overtake Samsung and SK Hynix.
How Would Micron Stock Overtake Samsung And SK Hynix?
Although Micron joined the High Bandwidth Memory (HBM) market later than SK Hynix, it has advanced swiftly. The business has gained clients in the growing AI ecosystem and launched several generations of HBM products tailored for AI accelerators. Micron has also invested heavily in advanced packaging and manufacturing to increase production capacity.
Micron’s recent quarterly report further showed that orders for its HBM products have exceeded available supply.
While Micron’s growth has been nothing short of spectacular, the journey ahead is not an easy one. Instead of depending on a single successful launch, the company will need to continuously offer competitive products across several generations in order to narrow the gap with Samsung and SK Hynix.
One of the biggest pros of Samsung is its massive production footprint. As the capacity of manufacturing grows, businesses can meet consumer demand and begin to reduce production expenses over time. Micron continues to invest in packaging innovations and new packaging facilities, but will likely need to consistently invest for years to equal the size of its larger rivals.
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Micron’s (MU) stock price has seen nearly 713% growth over the past year. Wall Street analysts have become increasingly bullish on MU. Bernstein analyst Mark Li recently revised his price target for MU to $1300. Bank of America, revised their target to $1550. The average price target for Micron (MU) is currently $1564 from a collective of Wall Street analysts. The bullish outlook is another testament to the company’s potential in the years ahead.