MU
Micron Technology, Inc.
HBM Memory — AI Critical Path
$757.35
May 8, 2026 · Mkt Cap $729B · +38% on week (best week since 2008)
52W: $84.68 – $759.50
⏸ HOLD — ADD ONLY $600–650
Add only on 20%+ pullback
📌 Current holding
Only US-based DRAM/NAND manufacturer. FQ2 FY26: $23.86B revenue +196% YoY; 74.9% gross margin (record). HBM sold out at locked prices through 2026. FQ3 guide $33.5B at ~81% gross margin. S&P 100 member March 2026. Stock +800% in 12 months.
Fwd P/E (post-rally)
~22×
⚠ was 7.5× at $400
PEG
<0.5
Still cheap on growth
FQ2 Rev Growth
+196%
YoY
FQ2 Gross Margin
74.9%
Record
FQ3 Guide
$33.5B
~81% GM
FQ2 EPS Beat
$12.20
vs $9.19 (+33%)
Rule of 40 proxy
225+
Next Earnings
~Jun 25
FQ3 FY26 · Est.
Valuation vs Growth
A
Fwd P/E ~22× at $757 (was 7.5× at $400 — valuation has normalised rapidly as price ran). PEG still <0.5. Morningstar independent FV $933. Revenue +196% YoY; FQ3 guided +200%+. EPS beat consensus by 33%. 4 consecutive beats. S&P 100 inclusion March 2026 drives passive bid.
Optically cheap but cycle-extended. Best valuation/growth in memory; stock has caught up.
Fundamentals vs Hype
A
Gross margin 30% → 56% → 74.9% in 4 quarters — fastest GM expansion in industry history. FCF $6.9B Q1. HBM locked pricing through 2026. Capex raised to >$25B. Beth Kindig: "#1 AI chip pick for 2026." Counter: SemiAnalysis reports MU excluded from Vera Rubin Year-1 HBM4 builds — Samsung/SK Hynix dominate.
Grounded but cycle-extended. HBM4 Vera Rubin position = the swing factor for 2027.
Institutional vs Retail
A+
80%+ institutional. S&P 100 inclusion (March 2026) = forced passive buying. 2,950 13F filers. Top holders: Vanguard, BlackRock, Capital World. Short interest 3.22% (meaningful for context). Retail "Extremely Bullish" with parabolic momentum. D.A. Davidson initiated Buy late April 2026.
Institutionally driven with retail momentum overlay (parabolic week of May 8).
Verdict
HOLD — do not add at $757. The thesis is intact: HBM supercycle, locked pricing, 74.9% gross margin, FQ3 guide at $33.5B. But the stock is up 800% in 12 months and just had its best week since 2008. Adding here is chasing a parabola. The risk/reward asymmetry is poor: upside to $900-1000 if cycle holds; downside to $450-550 if HBM4 Vera Rubin design win fails or cycle turns. Better to add the thesis at $600-650 where the margin of safety returns.
Hold current position · Add only on dip to $600–650 (currently $757 — no add)
⚠ Key Risks
- 01HBM4 Vera Rubin Year-1 design loss — SemiAnalysis (Jan 28): Samsung/SK Hynix took the slots; Micron may wait for HBM4E or 2027 refresh cycle
- 02Memory cyclicality — FQ2 gross margin 74.9% is extraordinary and unlikely to be the new normal; Samsung/SK Hynix capacity additions = pricing pressure H2 2027
- 03Parabolic technical setup — +800% in 12 months invites 30%+ drawdown on a single catalyst miss; no price target support at $757
- 04Capex >$25B FY26 — execution risk on HBM4 redesign and yield ramp if Vera Rubin design win delayed
- 05CXMT (China domestic DRAM) secular pressure — long-term market share erosion in legacy DRAM as China builds domestic capacity