Micron (MU +13.56%) stock took a tumble Thursday, falling 3% on a report from Bernstein highlighting trouble in the computer memory spot market.
On Friday, shares of the popular computer memory-maker bounced 9.3% through 10:30 a.m. ET -- Bernstein may be behind this movement, too.
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What Bernstein says about Micron
Bernstein warned yesterday of a shortage of both DRAM and NAND flash computer memory. There's not enough supply to meet demand for all the artificial intelligence chips that Nvidia (NVDA +1.81%), AMD (AMD +9.54%), and others are churning out. Customers are bidding against one another and driving prices higher.
That sounds like good news for Micron, which makes both NAND and DRAM. However, prices have gotten so high that "OEMs & module houses [are being forced to] reduce their purchases." Near term, this could cause price hikes to "decelerate notably" into Q2 2026, potentially slowing Micron's profit growth.
NASDAQ: MU
Key Data Points
What does this mean for Micron?
That's the bad news; here's the good: DRAM prices soared 57% in April versus average prices in Q1. NAND prices rose 65% to 70%, according to Bernstein. So even if some buyers are forced to curtail purchases in Q2, those who have the money to spend will continue buying memory, driving "major" increases in both DRAM and NAND in Q2 2026, currently underway.
Long story short, while it's uncertain what the future may hold medium or long term, in the near term at least, analyst forecasts for Micron to earn nearly $19 a share in the May quarter, and to grow sales 260% to $33.5 billion, should be safe.
And here's a prediction for you: Last I checked, Bernstein had a $510 price target on Micron. Given its bullish outlook and buy rating, though, I expect a price target hike sooner rather than later.
