Micron Stock Upgraded to 'Overweight' by Morgan Stanley
Analyst cites accelerating DRAM pricing and a cyclical recovery in the memory chip market as key drivers for the bullish outlook.
Micron Technology (MU) received a significant vote of confidence from Wall Street, as Morgan Stanley upgraded the semiconductor giant to 'Overweight' from a previous 'Equal-weight' rating. The move reflects growing optimism about a robust recovery in the memory market and signals strengthening investor sentiment for the sector.
In the analyst note, Morgan Stanley's Joseph Moore detailed the rationale behind the upgrade, boosting the firm's price target on Micron shares to $220 from $160. The primary driver for the reassessment is the , which has continued to surpass expectations and points to a healthier supply-demand balance.
The firm's industry checks suggest that the memory market is experiencing a cyclical upswing, with the potential for double-digit sequential price increases heading into the final quarter of 2024 and the first quarter of 2025. This trend is supported by , who indicate that tight DRAM supply could persist for several quarters, giving companies like Micron greater pricing power.
According to the report, concerns regarding high-bandwidth memory (HBM) are also easing as the broader DRAM economics improve. Morgan Stanley's upgrade is a key indicator that is on the rise, particularly for companies poised to capitalize on renewed demand for memory chips. Investors will be closely watching Micron's performance to see if the anticipated market recovery translates into sustained earnings growth.