Micron Technology (MU)
A memory giant positioned for the next leg of AI demand
Micron has quietly become one of the clearest beneficiaries of the AI boom, even though most of the headlines go to GPU makers. The stock trades around $225, up roughly 180% year to date, and we think the momentum is still supported by real fundamentals rather than hype.
Here’s the simple but powerful setup: generative AI cannot function without enormous amounts of high-bandwidth memory. GPUs may get all the attention, but memory is what actually stores the datasets, supports training workloads, and delivers the real-time responsiveness consumers expect from modern AI models. As systems scale, the memory requirement scales even faster. That puts Micron — a long-time leader in DRAM and NAND flash — in a very favorable position going into 2026 and beyond.
What we find particularly compelling is that Micron participates in AI infrastructure without being dependent on AI alone. Its core technologies are also used across smartphones, PCs, autos, and other consumer hardware. That diversification helps smooth out volatility and gives the company multiple drivers of long-term growth.
There’s also a supply-demand story developing that favors manufacturers like Micron. Industry reports suggest that AI-related demand may be outpacing the speed at which memory producers can bring new supply online. Some manufacturers have already begun raising prices in specific product categories — a dynamic that could meaningfully expand Micron’s margins over the next few years.
Despite all this, Micron remains surprisingly inexpensive. With a forward P/E near 15, the stock looks undervalued relative to its growth drivers, especially considering the possibility of sustained shortages and rising pricing power as AI workloads accelerate.
In short, Micron is one of the few companies positioned to benefit from AI’s next leg of growth without taking on the concentration risk that comes from relying on a single segment. For investors looking for AI exposure supported by a diversified business model, this is a name worth keeping on the radar.
