Back in August, Samsung announced it had begun mass production of its first 3D NAND vertical flash memory chips, a huge leap forward as many consumer products continue to look for the ability to store and reproduce more data. NAND flash memory is a type of non-volatile storage technology that does not require power to retain data.

New developments like Samsung’s 3D NAND flash memory technology are making the chips smaller, increasing the maximum read-write cycles and lowering voltage demands. Such improvements will continue make the technology even more common. In a new research report, the chip analysts at Piper Jaffray highlight the top stocks to buy that will be instrumental in this new leap in chip technology.

SanDisk Corp. (NASDAQ: SNDK) is often considered the king of flash memory. It will follow in Samsung’s footsteps by offering a 3D NAND solution in 2015 or 2016. SanDisk’s quality, state-of-the-art solutions are at the heart of many of the world’s largest data centers, as well as embedded in advanced smartphones, tablets and PCs. Investors are paid a 1.3% dividend. The Piper Jaffray price target for the stock is set at $78, and the Thomson/First Call price target is at $75. SanDisk closed Wednesday at $67.37.

Applied Materials Inc. (NASDAQ: AMAT has long been the powerhouse name in chip capital equipment. The company is ramping up its efforts to be a bigger player in the NAND sector. For Applied Materials, where its share has been low, this new architecture throws open a new opportunity. Investors are paid a 2.3% dividend. The Piper Jaffray target price for the stock is $20. The consensus target is $20 as well. Applied closed Wednesday at $16.83.

KLA-Tencor Corp. (NASDAQ: KLAC) indicated last week at a Credit Suisse conference that bookings this quarter may be below the midpoint of what the company had previously forecast, attributing the change to a $100 million order for tools for 10-nanometer chip production being delayed until next quarter. This caused an almost 5% sell-off in the stock and may provide an excellent entry point. Investors receive a 2.8% dividend. The Piper Jaffray target price is $70, the same as the consensus target. KLA-Tencor closed Wednesday at $61.97.

Lam Research Corp. (NASDAQ: LRCX) designs, manufactures, markets, refurbishes and services semiconductor processing equipment used in the fabrication of integrated circuits. The company offers plasma etch products that remove materials from the wafer to create the features and patterns of a device. The Piper Jaffray analysts highlight the company and its peers as having a significant equipment opportunity from the NAND evolution. The Piper Jaffray price target for the stock is $59. The consensus target is slightly higher at $62. Lam Research closed Wednesday at $51.25.

Micron Technology Inc. (NASDAQ: MU) is a global leader in advanced semiconductor systems. Micron’s broad portfolio of high-performance memory technologies — including DRAM, NAND and NOR Flash — is the basis for solid state drives, modules, multichip packages and other system solutions. The company’s memory chip solutions enable the world’s most innovative computing, consumer, enterprise storage, networking, mobile, embedded and automotive applications. The Piper Jaffray price target for the stock, which has soared this year, is $31. The consensus target is posted much lower at $22. Micron closed Wednesday at $22.50.

The flash memory business is absolutely on fire. Industry sales have grown from $13 billion in 2008 to $26 billion last year. Industry experts expect sales to grow to a staggering $38 billion by 2016. Investors looking for one of the hottest sub-sectors of the technology world need look no further than investing in the top flash memory companies.

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