Quick Read
-
Micron (MU) posted Q1 FY2026 revenue of $13.643B, up 56.6% year over year, with its Cloud Memory Business Unit nearly doubling to $5.284B at a 66% gross margin and guidance for Q2 EPS of $8.42 with 68% gross margin. Shares have surged 163% year to date and 693.87% over the past year, though they sit 25% below the $818.67 52-week high.
-
Reaching Micron’s $1,250 target by 2031 requires HBM margins to stay above 60%, fiscal 2027 EPS to exceed $20, and sustained hyperscaler capex demand, as AI infrastructure dependency has structurally changed memory economics from prior cycles.
-
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Micron Technology didn’t make the cut. Grab the names FREE today.
Micron Technology (NASDAQ:MU) has transformed from cyclical memory laggard into AI infrastructure essential in under a year. It delivered Q1 FY2026 revenue of $13.643 billion, up 56.6% year over year, with the Cloud Memory Business Unit nearly doubling to $5.284 billion at a 66% gross margin.
CEO Sanjay Mehrotra called Micron “an essential AI enabler”. Shares are up 163.25% year to date and 693.87% over the past year. The question I want to answer: can Micron reach $1,250 by 2031?
Why Micron Has Slipped From Its 52-Week High
The stock sits 25% below the $818.67 52-week high. Over the past week, shares added 3.63%, and the trailing month is up 54.06%, but composite sentiment has fallen 20.05 points over the past 30 days. Insiders have been net sellers across 65 recent transactions.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Micron Technology didn’t make the cut. Grab the names FREE today.
With a beta of 1.919, Micron moves harder than the market in both directions. Profit-taking after a 498.99% two-year run is showing up in price action. Concerns about NAND oversupply, heavy capex, and the cyclicality of memory remain credible risks.
Wall Street Is Bullish. Our Model Is Skeptical.
The Street is overwhelmingly positive: 9 strong buys, 30 buys, 5 holds, and 0 sells, with 89% rated bullish. The consensus target of $613.23 actually sits below today’s $751 price. Our 1-year base case is more bearish at $445.07, with a high confidence score of 90%. The optimistic 5-year case is $1,077.36.
I think both views anchor too hard to mean reversion. With 7.56% YoY earnings growth and Q2 FY2026 EPS guided to $8.42, the earnings trajectory looks structurally different from the last cycle. The model rightly penalizes mega-cap, high-beta names. It still does not fully capture HBM economics.
The Path to $1,250 Per Share
Reaching $1,250 from today’s price of $751 would require a gain of 66.4%. With forward EPS of $14.60, a price of $1,250 implies a forward P/E of 86x. Our base case already implies 67x, meaning the bold target requires 19x of additional multiple expansion. That sounds wild on the surface.
Here is the catch: forward EPS is poised to grow sharply. Q2 FY2026 alone is guided to $8.42 in non-GAAP EPS at a 68% non-GAAP gross margin. If fiscal 2027 EPS lands meaningfully above $14.60, the implied P/E at $1,250 compresses quickly.
Mehrotra noted that “our Q2 outlook reflects substantial records across revenue, gross margin, EPS and free cash flow”. An adjustment factor of 1.139 reflects strong sector momentum and bullish analyst consensus. The primary risk: a memory downturn that compresses HBM pricing before AI capex peaks.
Where Micron Trades Today vs Its Earnings Power
At $751 against forward EPS of $14.60, Micron trades at a forward P/E of 51x. That looks rich for memory, until you factor in the gross margin shift from 38.4% to 56% in a single year. Shares sit 25% off the high and have returned 6,602.87% over the past decade. The valuation case rests entirely on whether HBM pricing power persists into fiscal 2027.
Is $1,250 Realistic? Here’s My Take
$1,250 by 2031 demands a 66.4% gain from here. My honest verdict: a stretch, but well within reach if the AI memory cycle holds.
To get there, HBM margins need to stay above 60%, fiscal 2027 EPS has to land north of $20, and hyperscaler capex needs to keep the order book stretched into 2027. A cyclical memory downturn or NAND oversupply would derail it. Returns at this level shouldn’t be expected every year, but we’ve outlined the blueprint for how Micron Technology could reach $1,250 in 2031.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Micron Technology didn’t make the cut. Grab the names FREE today.
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: finance.yahoo.com
