TLDR
- Micron shares dropped 4.7% in premarket hours Tuesday to $963.79, retreating after crossing the $1,000 threshold the previous session.
- Climbing treasury yields pressured the broader semiconductor industry, with SK Hynix sliding 5.1% and Sandisk falling 5.5% premarket.
- Bank of America designated Micron as a “top pick,” projecting fiscal 2030 earnings per share between $200-$250, significantly above the $160-$170 consensus.
- Jim Cramer suggested Micron shares could “double again,” citing artificial intelligence demand and corporate buyback programs as catalysts.
- The Senate established an August 21 deadline for Apple’s response regarding recommendations to cease purchasing memory chips from China-based manufacturers.
Micron Technology (MU) shares declined 4.7% during premarket trading Tuesday to $963.79, halting a five-session rally that had recently lifted the stock above the $1,000 milestone for the first time since early July.
The retreat occurred as climbing treasury yields weighed on the semiconductor sector broadly. SK Hynix tumbled 5.1% in premarket U.S. trading, while Sandisk shed 5.5%. Elevated bond yields increase capital costs and typically weigh on growth-oriented equities.
The prior session had delivered robust performance for Micron. Shares advanced 4.1% to settle at $1,011.75, marking the fifth consecutive session of gains. Sandisk surged nearly 9%, Western Digital climbed 5.4%, and Seagate appreciated 2.2%. The Roundhill Memory ETF (DRAM) advanced 5.4%.
Memory sector stocks had retreated from June peaks but demonstrated fresh momentum throughout August as the second-quarter reporting period concluded.
Bank of America Elevates Micron to Top Pick Status
During Monday’s session, Bank of America elevated Micron to “top pick” status, arguing that future earnings could substantially surpass current analyst projections. The firm anticipates Micron’s fiscal 2030 earnings per share reaching $200-$250, versus Street consensus estimates of $160-$170.
BofA referenced SanDisk’s “durable growth outlook” as indication that the wider memory sector may be transitioning into a structurally robust phase.
Analysts on Wall Street maintain an average price objective of $1,549 for Micron, per FactSet data. The equity has surged over 700% during the trailing twelve-month period.
Robust cloud expansion and unprecedented data-center capital expenditures from leading technology firms have fueled the upward trajectory in memory equities. Some skeptics contend that long-term demand narratives are already reflected in current valuations.
One emerging catalyst gaining traction involves U.S. government pressure on Apple to discontinue sourcing memory components from Chinese manufacturers. This development could advantage domestic producers such as Micron. The Senate established August 21 as Apple’s response deadline.
Jim Cramer Forecasts MU Can Double From Current Levels
CNBC’s Jim Cramer expressed confidence in Micron’s continued upside potential. “I think Micron can double again before the boom comes to an end, assuming there’s no data center slowdown,” he stated.
Cramer highlighted share repurchase initiatives as an additional bullish indicator. Sandisk maintains $15.5 billion under its existing buyback authorization. Seagate continues executing a $5 billion program. Western Digital approved an incremental $4 billion authorization earlier this year.
Cramer’s Charitable Trust, the investment vehicle associated with CNBC’s Investing Club, recently established a position in Micron.
The Senate’s August 21 deadline for Apple’s chip sourcing response represents the next immediate catalyst for memory sector investors.
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