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Micron's Shares Skyrocket to New Heights as AI Demand Spurs Analysts' Bullish Forecasts

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Analysts Notebook wrote a column · Apr 2 07:24
$Micron Technology(MU.US)$'s stock reached a record high on Monday after Bank of America analysts raised their price target due to the company's advantageous position in the AI boom. This positive outlook contributed to a nearly 7% rise in Micron's shares, reaching $127, and adding to its impressive 50% increase year-to-date.
Micron's Shares Skyrocket to New Heights as AI Demand Spurs Analysts' Bullish Forecasts
Analysts Raised Their Price Target for MU
Bank of America analysts labeled Micron and other tech companies like $Marvell Technology(MRVL.US)$ and $Advanced Micro Devices(AMD.US)$ as "junior samurAI," indicating their potential for growth following the firm's preferred choices, $NVIDIA(NVDA.US)$ and $Broadcom(AVGO.US)$. The price target for Micron was increased from $120 to $144, reflecting the demand for high-bandwidth memory essential for AI, which Micron manufactures.
Each 'junior samurAI' trades interestingly at a valuation premium to its respective leader, so greater stock volatility is to be expected. As the leader expands the [total addressable market], the junior can likely continue to carve a profitable niche."
The analysts noted that with the demand for high-bandwidth memory (HBM) driven by AI technology, Micron is well-positioned to quickly increase its HBM market share, potentially outpacing its Korean competitors.
Citi maintained its Buy rating on shares of Micron Technology, while significantly raising the price target to $150 from the previous $95.
The analyst from Citi highlighted that the shipments of High Bandwidth Memory (HBM), which are being included in Nvidia AI systems, are expected to contribute to Micron's performance. This product commands higher prices and margins, bolstering the company's financial outlook.
Citi has recognized Micron Technology as a leading choice in its sector. This favorable perspective is based on the anticipation that Micron's engagement with AI and the related market trends will persist in boosting the company's appeal to investors.
South Korea Semiconductor Exports Hit a 24-month High
Last month, South Korea experienced a growth in exports, fueled by robust demand for semiconductors and other tech devices, which is bolstering policymakers' confidence in a strong economic performance for the first quarter. According to trade ministry data released on Monday, average daily shipments went up by 9.9% year-on-year. Unadjusted for working days, exports grew by 3.1%, while imports fell by 12.3%, resulting in a trade surplus of $4.3 billion. The latest figures point to continued recovery in global demand especially in the semiconductor sector.
This year's exports will be driven by technology," said Lee JaeYoon, a researcher at the Korea Institute for Industrial Economics & Trade. "Artificial intelligence and high-performance memory chips are among reasons semiconductor shipments are rising at a fast pace, raising hopes that they may grow enough this year to make up for losses last year."
Source: Bloomberg, Investing.com, BusinessKorea, Investopedia
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