TLDR
- Micron shares declined 4.7% in premarket trading Tuesday, dropping to $963.79 after briefly surpassing the $1,000 threshold on Monday.
- Climbing Treasury yields pressured semiconductor stocks broadly, with SK Hynix sliding 5.1% and Sandisk retreating 5.5% in early trading.
- Bank of America designated Micron as a premier investment choice, projecting fiscal year 2030 earnings per share between $200-$250, significantly exceeding consensus estimates of $160-$170.
- CNBC’s Jim Cramer expressed confidence that Micron shares could experience another doubling, citing artificial intelligence demand and corporate buyback initiatives.
- A U.S. Senate committee established August 21 as the date by which Apple must address recommendations to avoid purchasing memory components from China-based manufacturers.
Shares of Micron Technology (MU) experienced a 4.7% decline in Tuesday’s premarket session, settling at $963.79, ending a five-session rally that had briefly returned the stock above the psychologically important $1,000 level for the first time since early July.
The selloff occurred against a backdrop of increasing Treasury yields, which weighed heavily on the broader chip industry. SK Hynix tumbled 5.1% during U.S. premarket hours, while Sandisk declined 5.5%. Elevated bond yields typically increase capital costs and create headwinds for growth-oriented equities.
The previous trading session had delivered robust performance for Micron. Shares advanced 4.1% on Monday, finishing at $1,011.75 and marking their fifth consecutive session of appreciation. Sandisk surged nearly 9%, Western Digital climbed 5.4%, and Seagate registered a 2.2% gain. The Roundhill Memory ETF (DRAM) jumped 5.4%.
Memory-focused equities had experienced retracement from their June peaks but demonstrated revitalized momentum throughout August as the second-quarter reporting period concluded.
Bank of America Elevates Micron to Top Pick Status
Bank of America analysts elevated Micron to “top pick” designation on Monday, projecting that profitability could substantially surpass prevailing Wall Street forecasts. The investment bank anticipates Micron’s fiscal 2030 earnings per share will reach the $200-$250 range, considerably above the Street’s $160-$170 consensus estimate.
BofA referenced SanDisk’s “durable growth outlook” as validation that the memory chip sector may be transitioning into a period of enhanced structural strength.
According to FactSet data, Wall Street analysts maintain a mean price objective of $1,549 for Micron shares. The stock has surged more than 700% during the trailing twelve-month period.
Robust expansion in cloud computing and unprecedented data center infrastructure investment from leading technology corporations have fueled the rally in memory-related stocks. Skeptics contend that long-term demand expectations are already fully reflected in current valuations.
A more recent development attracting market attention involves U.S. governmental efforts encouraging Apple to discontinue procurement of memory chips from Chinese manufacturers. This shift could deliver meaningful benefits to domestically-based producers such as Micron. Senate officials have designated August 21 as the response deadline for Apple.
Cramer Forecasts Another Doubling for MU Shares
CNBC personality Jim Cramer expressed optimism about Micron’s continued upward trajectory. “I think Micron can double again before the boom comes to an end, assuming there’s no data center slowdown,” he remarked.
Cramer highlighted stock repurchase programs as an additional constructive indicator. Sandisk maintains $15.5 billion in remaining buyback authorization. Seagate is executing a $5 billion repurchase initiative. Western Digital approved an incremental $4 billion authorization earlier in the current year.
Cramer’s Charitable Trust, which forms the basis of CNBC’s Investing Club portfolio, recently established a position in Micron shares.
The approaching August 21 Senate deadline for Apple’s response regarding memory chip sourcing strategy represents the immediate near-term catalyst for memory semiconductor stocks.
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