Micron touches $1TRN valuation as UBS more than triples price target Proactive uses images sourced from Shutterstock
Micron Technology Inc (NASDAQ:MU) shares briefly surpassed a $1 trillion market capitalization on Tuesday for the first time, following a sharp rally driven by a major bullish call from UBS, which more than tripled its price target on the memory chip maker.
Shares of Micron were up 17% at $880 in afternoon trading, pushing the company’s valuation above the trillion-dollar threshold intraday before easing back below the level later in the session.
The move came after UBS raised its price target on Micron to $1,625 from $535 and reiterated a “buy” rating, citing what it described as structural changes in the memory chip industry driven by artificial intelligence demand and long-term supply agreements.
In its note, UBS said long-term agreements (LTAs) between memory suppliers and major customers are becoming more widespread across the industry, adding greater visibility into demand and smoothing revenue and earnings volatility. The firm estimates that a meaningful share of DRAM volumes is now being locked into multi-year contracts with partially fixed pricing structures.
According to UBS, these agreements could help reduce the traditional cyclicality of the memory market by limiting extreme price swings and improving earnings predictability. The firm also argued that hyperscale cloud customers are increasingly willing to trade pricing flexibility for guaranteed supply as AI-related infrastructure demand grows.
UBS raised its earnings outlook for Micron across fiscal years 2027 through 2029, saying it expects earnings per share to remain above $100 throughout the period. The bank also lifted its assumptions for high-bandwidth memory pricing, which it sees benefiting from sustained demand tied to AI workloads.
The revised outlook assumes continued industry undersupply in DRAM through at least 2028, along with tighter conditions in NAND markets than previously forecast. UBS also pointed to higher expected average selling prices for high-bandwidth memory as a key driver of its upgraded estimates.
Based on its updated model, UBS raised its valuation multiple for Micron and said it now applies a roughly 15-times forward price-to-earnings multiple to its 2029 earnings estimate, reflecting what it views as improved earnings durability and visibility.
Micron, which manufactures DRAM and NAND memory chips used in data centers, PCs, and mobile devices, has benefited in recent quarters from rising demand linked to AI infrastructure buildouts.