--- title: "Citigroup raises Micron's target price to $840! The target price nearly doubles, predicting a 200% surge in DRAM average prices next year" type: "News" locale: "en" url: "https://longbridge.com/en/news/286911542.md" description: "Citigroup raised the target price for Micron Technology's stock from $425 to $840, maintaining a \"Buy\" rating. Analysts expect DRAM prices to rise by 200% next year and believe Micron will achieve significant earnings growth by 2027. The company will benefit from the supply-demand imbalance in the DRAM market, and HBM prices are also expected to rise" datetime: "2026-05-19T12:23:03.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/286911542.md) - [en](https://longbridge.com/en/news/286911542.md) - [zh-HK](https://longbridge.com/zh-HK/news/286911542.md) --- # Citigroup raises Micron's target price to $840! The target price nearly doubles, predicting a 200% surge in DRAM average prices next year According to Zhitong Finance APP, Citigroup has significantly raised the target price for Micron Technology (MU.US) stock from $425 to $840, maintaining a "Buy" rating. The reason is the expectation that the company will increase the prices of dynamic random-access memory (DRAM). Analysts stated, "We have raised Micron's target price from $425 (which corresponds to 5 times the earnings per share for the calendar year 2027) to $840 (which corresponds to 8 times the earnings per share for the calendar year 2027), as we believe that after its peer Samsung raised prices by 100% in the first calendar year, Micron will increase DRAM prices by more than 40% in the second calendar year. Additionally, we expect the DRAM boom cycle to last until the calendar year 2027 and anticipate that the price of HBM \[High Bandwidth Memory\] will rise next year." "This year's DRAM price increases are largely concentrated on the supply-demand imbalance of commoditized or non-HBM DRAM. Despite the expectation from equipment manufacturers like Applied Materials (AMAT.US) for silicon system sales to grow by more than 30% recently, we believe that the growth rate of DRAM bit supply is heading towards 30% by the end of 2026, but additional new wafer capacity will still be needed to meet AI demand in 2027. We align Micron's forecasts with Citigroup's research view that the average selling price (ASP) of DRAM will soar by 200% year-on-year in 2026, while the average selling price of NAND will rise by 186% year-on-year in 2026." South Korean companies SK Hynix and Samsung Electronics are among the largest memory chip manufacturers in the world. SK Hynix is a major supplier of HBM chips for Nvidia. Samsung and Micron compete with SK Hynix in this field. Citigroup analysts pointed out that the supply of HBM remains tight. Analysts added that given the 3-to-4 wafer conversion rate and the profit margin differences between HBM and the commoditized market, memory manufacturers currently lack the motivation to convert or increase additional HBM capacity. The 3-to-4 wafer conversion rate typically refers to the physical switching or processing cost comparison between 3-inch and 4-inch semiconductor substrates. Analysts also added that due to the tight HBM capacity, they expect HBM pricing to rise in 2027, and memory manufacturers will remain restrained in increasing supply to prevent AI data centers from reducing HBM load next year. Analysts mentioned that last week, in response to strong pricing, Cisco has already reduced the DRAM load by 50% in more than 20 projects, including wireless products. The manufacturing process for HBM capacity is unique, involving the most complex advanced packaging, through-silicon vias (TSV), and yield issues in the memory chip industry to date. Strict cleanroom restrictions and higher green energy efficiency requirements hinder rapid capacity expansion to respond to soaring prices. Traditionally, when prices are extremely favorable for memory chip manufacturers, supply usually follows quickly. However, the industry currently faces many structural constraints—especially as the extremely complex manufacturing and packaging processes of HBM increasingly occupy capacity, and the supply elasticity of general DRAM/NAND is insufficient, while the growth rate of AI-driven demand continues to exceed expectations In the first quarter earnings call, Micron's management specifically mentioned the explosive demand for high-capacity data center SSDs aimed at AI infrastructure, KV cache deployments, and PCIe Gen6 SSDs related to NVIDIA's AI computing infrastructure clusters. This indicates that the demand for AI-related storage chips is much broader than many Wall Street analysts had anticipated. Modern AI infrastructure not only consumes more HBM memory but also requires high-bandwidth DRAM, more storage capacity, and high-speed SSD infrastructure to meet the growing demands of retrieval and agentic AI workloads. Emerging AI applications, including robotics, multi-AI agent systems, and multimodal reasoning models, are also continuously creating new vectors of storage demand, suggesting that the storage intensity for AI may continue to grow exponentially even after AI deployment is completed. As Jeremy Werner, Senior Vice President and General Manager of Micron's Data Center Business Unit, revealed in a recent interview, the underlying driving force of this market cycle is not simply "AI needs more computing chips," but rather that the AI inference era dominated by AI agents like Claude Cowork and OpenClaw has pushed memory/storage from being a supporting component to becoming a system bottleneck. AI training engineering relies more on large-scale parallel computing, while inference, especially for long context, multi-turn dialogue, and agentic AI workflows, requires continuous preservation of KV Cache, contextual states, and intermediate results; when memory/storage space is insufficient, models have to recompute historical states, leading to decreased GPU utilization and increased token generation costs. Therefore, HBM, DDR5, LPDDR, enterprise-grade SSDs, and even HDD/data lakes are forming an "AI memory chain" from the GPU near end to the far end storage, determining the throughput, latency, concurrency capabilities, and unit economics of tokens in AI systems. This is also why storage and data storage stocks such as Micron, Samsung, SK Hynix, SanDisk, and Western Digital have experienced a surge in correlation: demand is not only concentrated on HBM but is spilling over along the entire chain from AI server architecture to DRAM, NAND, SSD, and HDD ### Related Stocks - [MU.US](https://longbridge.com/en/quote/MU.US.md) - [SOXL.US](https://longbridge.com/en/quote/SOXL.US.md) - [MULL.US](https://longbridge.com/en/quote/MULL.US.md) - [SMH.US](https://longbridge.com/en/quote/SMH.US.md) - [SOXX.US](https://longbridge.com/en/quote/SOXX.US.md) - [PSI.US](https://longbridge.com/en/quote/PSI.US.md) - [SOXQ.US](https://longbridge.com/en/quote/SOXQ.US.md) - [MUU.US](https://longbridge.com/en/quote/MUU.US.md) - [XSD.US](https://longbridge.com/en/quote/XSD.US.md) - [FTXL.US](https://longbridge.com/en/quote/FTXL.US.md) - [DRAM.US](https://longbridge.com/en/quote/DRAM.US.md) - [C.US](https://longbridge.com/en/quote/C.US.md) - [SSNGY.US](https://longbridge.com/en/quote/SSNGY.US.md) - [AMAT.US](https://longbridge.com/en/quote/AMAT.US.md) - [NVDA.US](https://longbridge.com/en/quote/NVDA.US.md) - [CSCO.US](https://longbridge.com/en/quote/CSCO.US.md) - [SNDK.US](https://longbridge.com/en/quote/SNDK.US.md) - [WDC.US](https://longbridge.com/en/quote/WDC.US.md) - [C-R.US](https://longbridge.com/en/quote/C-R.US.md) - [SMSN.UK](https://longbridge.com/en/quote/SMSN.UK.md) - [NVD.DE](https://longbridge.com/en/quote/NVD.DE.md) - [SNDKV.US](https://longbridge.com/en/quote/SNDKV.US.md) - [WDCVV.US](https://longbridge.com/en/quote/WDCVV.US.md) ## Related News & Research - [GraniteShares Goes Down The AI Memory Lane, Eyes An Autocallable DRAM ETF](https://longbridge.com/en/news/286936026.md) - [DRAM ETF is firing on all cylinders, but beware of major risks](https://longbridge.com/en/news/286581778.md) - [DRAM prices soar nearly 500% as AI fuels shortage](https://longbridge.com/en/news/286214737.md) - [Micron Stock (MU) Surges 154% YTD; Do Analysts See More Upside?](https://longbridge.com/en/news/286651011.md) - [Micron or SanDisk: Billionaire Israel Englander Picks One AI Memory Stock Over the Other](https://longbridge.com/en/news/286826007.md)