‘Load Up,’ Says 5-Star Analyst on Micron Stock (MU) Ahead of Q4 Earnings

Deutsche Bank analyst Sidney Ho reiterated a Buy rating on Micron Technology (MU) and raised his price target to $175, ahead of its Q4 FY25 earnings, citing persistent tight DRAM supply and strengthening NAND pricing expected to drive gross margins above 50%. Ho projects DRAM constraints into 2026 due to high-bandwidth memory (HBM) demand and robust NAND momentum, leading to increased CY26 revenue and EPS estimates, despite the stock currently trading near Wall Street's average price target.

Analysis

Ahead of its Q4 FY25 earnings report, Micron Technology (MU) has received a reiterated Buy rating and a price target increase to $175 from $155 by Deutsche Bank, signaling strong conviction in the company's near-to-medium term outlook. The analyst's bullish thesis is anchored on two primary factors: persistent tightness in the DRAM market, projected to last into 2026 as high-bandwidth memory (HBM) for AI applications consumes significant capacity, and strengthening pricing power in the NAND market, fueled by higher storage content in new devices and robust enterprise SSD demand. These favorable supply-demand dynamics are expected to lift average selling prices and drive gross margins above the 50% threshold. Reflecting this optimism, the analyst has revised CY26 estimates upward, now forecasting revenue of $54.3 billion and EPS of $15.45, a 6% increase from prior projections. While concerns over future HBM pricing are viewed as overstated due to Micron's strong AI positioning, it is important to contextualize this individual analyst's view against the broader market. Despite a "Strong Buy" consensus from Wall Street (25 Buys vs. 4 Holds), the stock's recent appreciation has brought it near the average price target of $153.19, which implies a 2.57% downside from current levels and suggests the positive outlook may be largely priced in by the consensus.

Key Decisions for Investors

• Investors aligned with the bullish outlook on memory cycle strength may see Deutsche Bank's $175 price target and upgraded CY26 EPS forecast of $15.45 as a reason to maintain or build positions, focusing on the long-term margin expansion potential.
• Given that Micron's stock is trading near the consensus price target, which implies a slight downside, caution is warranted ahead of the September 23 earnings report, as a significant beat will be necessary to justify further upside.
• Key factors to monitor in the upcoming earnings call include any management commentary on DRAM supply constraints, NAND pricing trends, and the long-term profitability outlook for HBM, as these will be critical drivers for future stock performance.