Micron stock (NASDAQ: MU) jumped roughly 7% on Wednesday, driven by major Wall Street price-target hikes and a strategic $1.8 billion acquisition of a chip fabrication facility in Taiwan.
The combination gave institutional investors reason to believe the memory-chip maker has locked in years of pricing power amid surging demand in the global memory market.
Micron stock: Analyst upgrades power momentum
Micron stock is doing really well since it reported its Q1 results in mid-December.
The company posted record revenue of $13.64 billion, crushing the analyst consensus of $13.0 billion, and delivered non-GAAP earnings per share of $4.78, up 167% year-over-year.
The gross margins expanded to 56.8%, a 17% jump from the prior year, signaling peak pricing power in high-bandwidth memory (HBM).
Management’s guidance for Q2 was equally aggressive.
Micron projected Q2 revenue of $18.7 billion with gross margins of 68%, an 11% sequential jump that analyst Thomas O’Malley at Barclays called evidence of “peak scarcity.”
That clarity triggered an avalanche of price-target hikes.
Barclays raised its 12-month target to $450 from $275 on January 15, a 64% jump.
Wells Fargo lifted its target to $410 from $335 on the same day.
UBS raised to $400 from $300. Piper Sandler, KeyBanc, Cantor Fitzgerald, and RBC Capital all followed within 24 hours, with targets clustering between $425 and $450.
These aggressive moves triggered momentum buying on heavy volume.
Institutional portfolios rebalanced toward the higher price targets, and that reweighting pushed shares up sharply.
Supply tightness and fab strategy validate bullish thesis
The structural backdrop justifies the analyst’s conviction. Every AI accelerator consumes multiple stacks of HBM.
The catch: for every gigabyte of HBM produced, Micron must sacrifice three gigabits of standard DRAM capacity.
That three-to-one ratio means HBM demand acts as a giant drag on commodity memory supply, tightening the market across all segments.
Supply relief is years away. Micron’s two new fabs in Boise are not operational until 2027 and 2028. A third fab in Clay, New York, won’t start producing until 2030.
Which is why the Powerchip Taiwan fab acquisition matters strategically.
Micron announced it will acquire the P5 fabrication site in Tongluo, Miaoli County, for $1.8 billion, bringing 300,000 square feet of cleanroom space under its control.
The company expects meaningful DRAM wafer output to begin in the second half of 2027, bridging a critical supply gap.
Traders flagged this as the final piece as blowout margins, sold-out capacity through 2026, and a visible fab acquisition to prove management is serious about scaling.
That narrative confluence explains Wednesday’s 7% pop.
For now, Micron stock looks less like a cyclical chip play and more like a structural beneficiary of the AI infrastructure buildout.
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