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On Friday, Piper Sandler analysts maintained their Overweight rating and $120.00 price target on Micron Technology (NASDAQ:MU), now a $105 billion market cap semiconductor giant. Their assessment follows the company’s latest earnings report, which surpassed Street expectations. Micron’s revenue saw a significant increase of over 50% in the recently reported February quarter, with trailing twelve-month revenue growth reaching nearly 80%, driven by the successful ramp-up of its High Bandwidth (NASDAQ:BAND) Memory (HBM) products. The company has also started shipping its HBM3E product to a new major customer, marking the third large client in its portfolio.According to InvestingPro data, Micron shows strong momentum with multiple growth indicators. Subscribers can access 8 additional exclusive ProTips about MU’s financial outlook.
Despite the positive top-line performance, Piper Sandler noted concerns regarding Micron’s profitability. The analysts pointed out that while the guidance for the top line remains strong, gross margin projections suggest a decrease in the upcoming May quarter. Currently trading at a P/E ratio of 27, with an overall "GOOD" Financial Health Score from InvestingPro, the company maintains a solid financial position despite margin pressures. Furthermore, only a modest improvement is expected in the fourth fiscal quarter margins compared to the third.
The analysts highlighted that the margin pressures are mainly due to adjustments in the company’s NAND supply. Nevertheless, they emphasized Micron’s strategic position to capitalize on the growing artificial intelligence (AI) market and the expansion of data centers.
Piper Sandler also projected that Micron would achieve a revenue velocity of approximately $2 billion in HBM by the first quarter of fiscal year 2026. This projection underscores the firm’s confidence in Micron’s HBM segment and its future growth potential.
Overall, the analysts reiterated their positive stance on Micron Technology, citing the company’s continued progress in HBM development and its alignment with key growth sectors such as AI and data center expansion. According to InvestingPro’s Fair Value analysis, the stock currently appears slightly undervalued. Despite the near-term margin concerns, Piper Sandler’s outlook remains optimistic about the company’s long-term prospects, aligned with InvestingPro’s assessment of strong future growth potential. For detailed analysis and comprehensive valuation metrics, investors can access Micron’s complete Pro Research Report, part of InvestingPro’s coverage of over 1,400 US stocks.
In other recent news, Micron Technology has seen a series of updates from various analyst firms following its latest financial performance and guidance. Baird analysts raised their price target for Micron to $163, citing the upcoming ramp of High Bandwidth Memory (HBM) as a significant growth factor, while maintaining an Outperform rating. Stifel reiterated a Buy rating with a $130 target, noting Micron’s better-than-expected fiscal second-quarter results and the anticipated increase in DRAM shipments for the third quarter. Rosenblatt Securities adjusted its price target to $200 from $250, maintaining a Buy recommendation, and highlighted the increased demand for HBM and the positive outlook for the latter half of 2025.
Cantor Fitzgerald also maintained its Overweight rating with a $130 target, emphasizing Micron’s strong guidance for the May quarter, which surpassed consensus estimates. The firm noted robust demand in the Data Center sector, particularly for HBM and high-capacity server DIMMs. Mizuho (NYSE:MFG) Securities raised its price target to $124 from $115, supported by Micron’s positive outlook in the HBM market and strong February quarter results, which included revenues of $8.05 billion and earnings per share of $1.56.
Micron’s focus on HBM and its strategic position in the memory market have been consistently highlighted across these analyses, with expectations of market share gains and improved gross margins. The firm’s guidance for future quarters continues to reflect optimism, with several analysts noting the potential for growth in the HBM and NAND markets. These recent developments indicate a generally positive sentiment among analysts regarding Micron’s future performance and market positioning.
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