September 6, 2024

Micron Technology’s AI Reach Leads To a BofA Price Target Increase

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Micron Technology’s AI Reach Leads To a BofA Price Target Increase

Key Takeaways

  • Bank of America raised its price target on Micron Technology, which it called its top pick among U.S. memory chipmakers.
  • BofA pointed to rising demand for more artificial intelligence (AI)-powered PCs for the optimism about Micron.
  • The researchers also lifted their outlook for Micron’s sales and earnings per share.

Shares of Micron Technology ( MU ) traded at an intraday record Monday after Bank of America raised its price target, saying the chipmaker will benefit from the booming demand for artificial intelligence (AI ) products.

BofA lifted the price outlook to $170 from $144, calling Micron its “top US memory company.”

The researchers explained that they believe “the emerging market for AI features on-device, aka Edge AI,” will “slowly but steadily supplement core or data center AI hardware.” They noted that the two most important beneficiaries of Edge AI will be manufacturers of compute and memory chips.

BofA Notes Rising Demand for AI-Powered PCs

The researchers wrote that because of rising demand for AI-powered personal computers, and the need for those to have more memory, plus their higher price tag, they are increasing Micron’s sales outlook for the 2025 calendar year and 2026 estimate by 10% and 12%, respectively. They also boosted their pro forma CY25/26E earnings per share (EPS ) forecast by 20%/21%.

Micron Technology shares, which were up 2.4% to $144.79 as of 11:15 a.m. ET after hitting a record $146.29 earlier in the session, are up nearly 70% so far this year.

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