Shares of Micron Technology (NASDAQ:MU) rose 3.18% in premarket trading Wednesday after UBS analyst Timothy Arcuri lifted his rating and price target on the memory chip maker.
In a note to clients, Arcuri upgraded Micron to “Buy” from “Neutral” and raised his price target on the name by nearly 60 percent to $75 per share.
The analyst cites “higher estimates” and better industry dynamics, as well as Micron’s strong market position in a structurally better industry which Arcuri sees as being on the verge of a cyclical upswing that, for DRAM chips (Dynamic Random Access Memory), should last “deep into 2021”.
It’s worth noting that more than 60% of Micron’s revenue comes from DRAM chips.
Further, Arcuri contends that Micron deserves a multiple expansion given its improved competitive position and cyclical financial performance relative to competitors like Intel (INTC) or Texas Instruments (TXN).
Last week, Raymond James upgraded Micron to ‘Strong Buy’ from ‘Market Perform’ and raised their price target to $70 per share, saying they expect supply/demand conditions improving.
Price Action
As of writing, Micron shares are up $3.01, or 5.40%, to $60.32. Ticker is up 12.22% year-to-date and $44.79% year-over-year. The $64 billion market cap company trades in a 52-week range of $32.14 to $60.56. The consensus price target for MU, scheduled to report Q2 results on March 25, is $66.74.
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