Micron stock rises as UBS reiterates Buy rating on improved outlook

Investing.com - Micron Technology (NASDAQ:MU) received a vote of confidence from UBS, which reiterated its Buy rating and $155.00 price target following the company’s improved financial outlook. The semiconductor giant, currently valued at $138.46 billion, is trading near its 52-week high with a remarkable 47% gain year-to-date. According to InvestingPro data, 10 analysts have recently revised their earnings estimates upward, with price targets ranging from $95 to $200.

The semiconductor manufacturer now expects fiscal fourth-quarter revenue of approximately $11.2 billion, representing a $500 million increase from UBS’s previous estimate of $10.7 billion. Micron also raised its gross margin forecast to approximately 44.5% and earnings per share to $2.85, exceeding earlier projections. The company’s strong financial health is reflected in its current P/E ratio of 21.88x and impressive revenue growth of 58.22% over the last twelve months. InvestingPro analysis indicates the stock is currently fairly valued, with additional insights available in the comprehensive Pro Research Report.

UBS attributed the upward revision to continued strength in data center and consumer markets, with most of the improvement coming from pricing rather than volumes. The firm’s industry checks indicate healthy consumer inventories, steady demand from smartphone and PC customers into the fourth quarter of 2025, and increasing hyperscaler DDR (NYSE:SITC) demand. With a current ratio of 2.75x and moderate debt levels, Micron maintains strong operational flexibility to capitalize on market opportunities.

Based on these developments, UBS has adjusted its forecast to model a modest DRAM and NAND upcycle lasting through the third quarter of 2026. The firm increased its DDR average selling price expectations to 5% and 3% quarter-over-quarter growth in Q4 2025 and Q1 2026, respectively, while also raising NAND price assumptions.

For High Bandwidth (NASDAQ:BAND) Memory (HBM), UBS slightly increased its industry demand forecast to 16.9 billion gigabytes in calendar year 2025 and 26.1 billion in 2026, reflecting increased forecasts for NVIDIA (NASDAQ:NVDA) shipments in the second half of 2025 and 2026.

In other recent news, Micron Technology has raised its revenue forecast for the upcoming quarter to $11.2 billion, up from a previous estimate of $10.7 billion, surpassing the consensus estimate of $10.8 billion. The company also increased its earnings per share guidance to $2.85, compared to the earlier expectation of $2.50, which was above analyst projections of $2.52. This improved outlook is primarily attributed to stronger pricing in DRAM and NAND memory chips. Several analyst firms have weighed in on these developments, with Mizuho (NYSE:MFG) raising its price target for Micron to $155 from $150, while maintaining an Outperform rating. Barclays (LON:BARC) reiterated an Overweight rating with a $140 price target, citing better execution and improved DRAM pricing. Rosenblatt Securities maintained a Buy rating and a $200 price target, highlighting Micron’s performance exceeding expectations. Wolfe Research also reiterated an Outperform rating with a $160 price target, noting the company’s pre-announcement of results that included a $500 million revenue increase and improved gross margins. BofA Securities maintained a Neutral rating with a $140 price target, despite the raised outlook, focusing on consistent shipment expectations.

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