Micron in focus as Stifel ups target ahead of Q4 results (MU:NASDAQ)

Stifel raised its price target on Micron Technology (MU) to $173 from $145, maintaining a Buy rating, ahead of its fiscal fourth-quarter results, citing expectations for increased data storage and eSSD demand from hyperscalers. The firm anticipates accelerating NAND bit-shipment growth in CY26 and stronger underlying memory pricing through CY25-end, alongside sustained gross margin expansion due to inventory drawdown and product mix optimization, despite a fractional premarket decline in shares.

Analysis

Ahead of its fiscal fourth-quarter results, Micron Technology (MU) received a significant endorsement from Stifel, which reiterated a Buy rating and raised its price target to $173 from $145. The core of this bullish thesis is the anticipated surge in data storage and eSSD demand from key hyperscaler customers, which Stifel believes will drive an acceleration in NAND bit-shipment growth in calendar year 2026 beyond current expectations. This demand-side strength is projected to support stronger underlying memory pricing through the end of calendar year 2025. From a financial perspective, Stifel anticipates sustained gross margin expansion in the near term, underpinned by a significant drawdown in memory inventory and an optimized product mix. Furthermore, while Micron is expected to guide fiscal 2026 capital expenditures higher, this increase is forecasted to be less than revenue growth, indicating improving capital intensity. This capex is earmarked for new fab construction rather than an immediate acceleration of supply, a disciplined approach that supports a favorable long-term supply-demand balance. The market awaits Micron's official results and guidance to validate this outlook against a consensus estimate of $2.86 EPS on $11.15 billion in revenue.

Key Decisions for Investors

• Investors should closely scrutinize Micron's upcoming earnings report and management guidance, using the consensus estimate of $2.86 EPS and Stifel's bullish forecasts on pricing and demand as key benchmarks for performance.
• Pay close attention to commentary on gross margin trends and inventory levels, as confirmation of a significant inventory drawdown would validate a core pillar of the bull case for sustained profitability.
• Evaluate the company's official fiscal 2026 capex guidance to confirm it aligns with Stifel's view of disciplined spending focused on long-term capacity rather than near-term supply, as this is critical for the sustainability of memory pricing.