On Monday, KeyBanc Capital Markets adjusted its outlook on Micron Technology (NASDAQ:MU) shares, increasing the price target to $150 from $135 while maintaining an Overweight rating. The firm's analyst cited Micron's advanced high-bandwidth memory (HBM) technology as a key factor for the positive reassessment.
Micron's HBM3E product reportedly exhibits superior thermal and power performance compared to its competitor, SK Hynix, and with Samsung (KS:005930) not currently offering a competitive product, Micron is expected to lead the market. This advantage positions the company favorably as it approaches the ramp-up of its B100 and B200 series products.
The analyst believes that Micron's existing HBM capacity is adequate to not only meet but significantly surpass its fiscal year 2024 revenue projections, which were initially set to be several hundred million dollars. The company is anticipated to generate over $1 billion in HBM revenues in the calendar year 2024.
The firm anticipates that as the market recognizes Micron's strong standing in the HBM sector, particularly in relation to artificial intelligence applications, the stock will experience a re-rating. This adjustment is expected to reflect the company's emerging status as a significant player in the AI technology space.
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