Micron Stock Surge: Analyst Raises Price Target to $3,000 on AI Demand

Memory chip manufacturer Micron has seen its stock more than triple since the beginning of the year, surging by 263%, yet veteran technology analyst Gil Luria from investment bank D.A. Davidson believes the stock still has significant room to grow.

Price Target Hike and AI Demand

CNBC reported that the investment bank reaffirmed its buy rating on the stock and sharply raised its price target from $2,100 to $3,000, representing an exceptional upside of approximately 190% compared to its previous closing price. Following a meeting with management, Luria wrote in a note to clients that investors are only at the beginning of understanding Micron's true value.

"If you don't buy it, they will," Luria wrote, emphasizing that artificial intelligence models require significantly more memory to operate faster, yield better results, and maintain longer context windows.

Strategic Contracts and Share Buybacks

Luria noted that Micron aims to reach a milestone where 50% of its revenues stem from strategic long-term customer agreements. Because these contracts cannot be easily cancelled, they effectively guarantee sales for coming years, reinforcing investor confidence in the company's operational trajectory.

Another major catalyst for Micron is the anticipated launch of a substantial share buyback program in December. Restrictions stemming from the CHIPS Act, implemented during the administration of former US President Joe Biden, are set to expire that month, allowing the company to return excess cash to shareholders.