The Nasdaq Is Approaching All-Time Highs. Is It Too Late to Buy These Artificial Intelligence (AI) Growth Stocks?

The article is bullish on AI-linked memory and storage stocks, highlighting Sandisk’s 304% year-to-date gain and 3,142% 12-month return, yet arguing it still screens as a value at 17x forward earnings. Micron is also described as attractive, up 70% YTD and 593% over 12 months, trading at 21x earnings and 9x forward P/E, with HBM supply sold out for 2026. The piece frames the Nasdaq’s 14% April rebound as evidence of renewed risk-on buying after the Q1 correction.

Analysis

The market is repricing memory as an AI infrastructure bottleneck rather than a commodity business, and that usually sustains for longer than consensus expects. Once cloud and hyperscaler buyers fear allocation risk, they shift from just-in-time procurement to duration-buying, which supports price discipline even if end-demand decelerates. That dynamic favors the highest-quality supply holders and can keep gross margins elevated for several quarters beyond the point when headline AI growth rates start to normalize.

The second-order winner is not just SNDK and MU, but also upstream equipment and validation ecosystems that benefit from sustained capex and tighter node transitions. The hidden risk is that this becomes a crowded “obvious winner” trade: as inventories rebuild and pricing stabilizes, the stocks can re-rate faster than fundamentals, especially if investors are paying up for peak-cycle earnings. WDC has some participation, but it is more exposed to mix and execution risk, so the market may eventually reward the cleaner purity plays while discounting weaker adjacent exposure.

The key contrarian point is that value multiples alone are not a sufficient margin of safety if earnings are near cyclical peaks. Both names will be vulnerable to any sign that HBM/NAND pricing is rolling over 1-2 quarters ahead of consensus, and because sentiment is already stretched, any guidance miss could trigger a sharp de-grossing. The best setup is to own the leaders on pullbacks, not chase strength after large gap-ups, and to express relative conviction where the supply-demand imbalance is strongest and least substitutable.

Key Decisions for Investors

• Buy MU on a 5-8% pullback over the next 2-4 weeks; target a 3-5 month hold. Risk/reward favors MU over SNDK because HBM scarcity offers more durable pricing power and a cleaner path to upward estimate revisions.
• Initiate a pair trade: long MU / short WDC for 1-3 months. The spread should widen if the market continues rewarding AI-memory purity and penalizing more exposed or less levered peers; stop out if NAND pricing rolls over faster than HBM.
• Add SNDK only via staged entries after consolidation, not momentum chasing. Use a 6-12 month horizon; the stock can remain expensive if supercycle evidence persists, but the position should be sized for peak-cycle volatility and multiple compression risk.
• For tactical upside, buy 3-6 month call spreads in SNDK or MU instead of outright common if implied vol remains elevated. This captures continuation while limiting damage if the trade becomes crowded and mean reverts.
• Set a risk trigger on any sign of inventory buildup or management commentary implying 2H price normalization; if that happens, reduce memory exposure by 25-50% within days rather than waiting for reported margin compression.