Key Takeaways
- Memory chip stocks rebounded sharply Friday, with Micron climbing 6.1%, SanDisk soaring 11.9%, and SK Hynix advancing 8.1%
- Constrained supply of HBM and NAND combined with robust AI data centre demand continues supporting elevated memory pricing
- Reports indicate Micron has completely booked its cutting-edge memory production capacity through 2026
- UBS analysts increased their HBM pricing growth projection to 79% annually from a previous 67% estimate
- Lynx Equity published aggressive price targets of $1,325 on Micron and $2,450 on SanDisk, predicting extended memory supply constraints
The memory semiconductor sector experienced a substantial rebound Friday, ending weeks of downward pressure with impressive gains across major chipmakers.
Micron closed the session up 6.1%, while SanDisk delivered an exceptional 11.9% surge, and SK Hynix posted an 8.1% advance. Western Digital contributed to the sector momentum with a roughly 6% increase. The Roundhill Memory ETF concluded trading 6.6% higher, demonstrating widespread buying interest throughout the memory space.
The sector-wide resurgence reflected investor appetite for memory and data storage companies amid persistent AI infrastructure expansion and constrained component availability.
Artificial Intelligence Infrastructure Drives Persistent Memory Requirements
Supply constraints continue affecting high-bandwidth memory and NAND flash storage. The rapid expansion of AI data centre infrastructure maintains significant pressure on available inventory.
Micron has allegedly secured orders for its most sophisticated memory products extending through late 2026. This situation provides leading manufacturers considerable leverage in price negotiations for the remainder of the year.
Dell’s massive $95 billion AI server order backlog serves as concrete proof that large technology firms are purchasing all available memory wafer output from suppliers.
According to Barron’s, worldwide DRAM revenue increased 57% sequentially in Q2, while NAND revenue experienced a 70% jump. Micron expanded its DRAM market position to 24% and captured 15% of the NAND market.
Mizuho analysts have identified memory as a “key bottleneck” throughout the semiconductor supply chain and maintained their Outperform rating on Micron shares.
Nvidia revealed $279 billion in supply and capacity obligations, predominantly related to memory components and manufacturing, emphasizing the critical nature of component accessibility for AI infrastructure deployment.
Wall Street Analysts Boost Forecasts and Price Objectives
Timothy Arcuri from UBS suggested that worries about AI processors requiring reduced memory per unit may oversimplify the situation. Should Nvidia deliver increased accelerator volumes, aggregate HBM consumption could continue growing despite individual chips containing less memory.
UBS elevated its HBM average selling price growth prediction to 79% year-over-year from 67%, while also noting improving NAND market conditions driven by enhanced server and storage demand.
Lynx Equity published optimistic research predicting prolonged memory supply shortages and established price objectives of $1,325 for Micron shares and $2,450 for SanDisk.
Bernstein maintained its Outperform rating on SanDisk with a $3,000 price target, increased from $1,700 in late June. The firm adjusted its fiscal 2027 earnings projections upward based on stronger NAND average selling prices.
Bernstein emphasized SanDisk’s recently established long-term supply contracts, which incorporate enhanced pricing safeguards and advance customer commitments.
Competition from China represents one potential risk factor under market observation. YMTC’s worldwide NAND market share climbed to 14% in Q2, up from 9% the previous year, while SanDisk’s share decreased to 11% from 13%.
A stronger-than-anticipated U.S. employment report initially sparked interest rate concerns Friday morning. Nevertheless, investors quickly shifted focus and accumulated growth stocks trading at reduced valuations.
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