Micron Peer Enthusiasm Entices Me To Buy Again
Sentiment on Micron has cratered, Reddit has turned bearish, and the stock is down double digits in a month. Here is why that only makes the buying case stronger.
I added to my Micron Technology (NASDAQ:MU | MU Price Prediction) position again this week, and I already expect to add more after the next earnings report. The stock closed at $934.27 on October 29, down 12.27% over the past month, after Samsung’s earnings showed how high the bar is for memory stocks. Reddit sentiment on the stock has plummeted from bullish to bearish. I keep buying anyway.
Peer Enthusiasm Points Straight at Memory
Memory has become the bottleneck in AI, and Micron’s customers and rivals keep showing it. NVIDIA (NASDAQ:NVDA) reported that its supply obligations rose to $279.00 billion, largely tied to memory procurement for Vera Rubin. This week, rival SK Hynix fueled the AI frenzy with fresh news of its own. Micron’s leadership puts it simply: “DRAM is the principal constraint versus logic or power to the data center.” When the biggest buyer in AI commits that kind of money to memory, I want to own the company selling it.
Three Numbers Behind Every Purchase
The first is growth. Quarterly revenue went from $13.64B in fiscal Q1 2026 to $54.23B in fiscal Q4. Full-year revenue reached $133.19B, up 256.33%. For fiscal Q1 2027, management guided to $61.5B ± $1.5B in revenue and $38.15 ± $1.00 in non-GAAP EPS.
The second is durability. Micron now has 26 Strategic Customer Agreements running through 2030, which management expects to cover about 35% of sales by 2030. Most of the pricing models include floor and ceiling bands, and more than 75% of fiscal 2027 shipments are already committed.
The third is cash. Fiscal 2026 free cash flow came in at $62.31B. Micron ended the year with $38.36B in cash and $138.38B in shareholders’ equity, against $57.51B in total liabilities. The board also approved a 30% dividend increase, which brought the annualized forward payout to $0.60.
Why My Money Skips NVIDIA and Western Digital
I like NVIDIA, but it trades at about 43 times earnings. At today’s price, Micron trades at about 12 times its fiscal 2026 non-GAAP EPS of $75.52. The supplier NVIDIA depends on is better at that lower multiple.
Western Digital (NASDAQ:WDC) also has AI exposure, through hard drives. Its non-GAAP gross margin was 58.1% last quarter. Micron’s was 87.0%. That gap tells me where the pricing power lies.
Risks I Take Seriously
Memory has always been cyclical, and I have watched this industry go from shortage to glut before. Micron spent $30.71B on capex in fiscal 2026, and its high-volume HBM4 shipments depend heavily on one lead customer. If AI spending stalls, this stock will feel it first.
My thesis still holds because the contracts change how a downturn would play out. Price floors, multiyear agreements, and committed volumes give Micron something past cycles never had. Management says it has “no line of sight to when supply and demand balance,” and it will equip new clean rooms only as demand calls for them.
What Keeps Me Buying
HBM4E is aiming for volume production in calendar 2027. The 1-gamma node is on track to become the largest in Micron’s history, and the CFO expects market conditions to stay “tight” through 2028. The AI industry keeps paying a premium for memory, and every dip gives me a cheaper price on the company that makes it (we reverse-engineered what the biggest early-stage AI winners looked like before their runs in a free report here: The Next Nvidia Playbook).
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Alex Sirois is a financial writer with experience spanning both retail and institutional investing. He has written for InvestorPlace and held roles at BNY Mellon and Bernstein, giving him a perspective that bridges Main Street portfolios and Wall Street analysis.
Alex holds an MBA from George Washington University and has built his career across multiple industries, including e-commerce, education, and translation — a breadth of experience that informs how he breaks down complex financial topics for everyday investors. His writing is conversational, actionable, and grounded in long-term, buy-and-hold investing principles.
At 247 Wall St., Alex focuses on delivering analysis that is both accessible and useful, with a clear emphasis on helping readers make more informed decisions with their money.
