“Cantor Fitzgerald Maintains Overweight Rating on Micron, $150 PT Amid Data Center…

Source: Davit Kirakosyan

Cantor Fitzgerald Reaffirms Overweight Rating on Micron Technology

Cantor Fitzgerald analysts recently reaffirmed their Overweight rating on Micron Technology (NASDAQ:MU), maintaining a price target of $150. This decision came after an investor call that focused on the health of the DRAM and HBM markets, as well as Micron’s expanding product portfolio. Let’s delve deeper into the key points discussed during the call and explore the reasons behind the analysts’ positive outlook for Micron.

Strength in the Data Center Sector

One of the highlights of the investor call was Micron’s robust performance in the data center sector. The company has been experiencing significant growth, driven by demand from both AI and traditional servers. This strong momentum is expected to translate into upside potential for Micron’s November quarter guidance. The analysts pointed out that Micron is poised to benefit from mid-single-digit growth in server demand, particularly fueled by AI applications. While projections for PCs and smartphones are more conservative, a recovery is anticipated by mid-2024.

Focus on High-Value, Higher-Margin Solutions

A key takeaway from the investor call was Micron’s strategic shift towards high-value, higher-margin solutions. This move is seen as an underappreciated aspect of Micron’s growth story. In addition to its HBM products, which are known for their high performance and bandwidth, Micron’s product portfolio includes high-capacity server DRAM, LPDDR5, and eSSD. These offerings are expected to drive multi-billion-dollar revenues by fiscal 2025.

Long-Term Profitability and Potential

The Cantor Fitzgerald analysts highlighted that Micron’s focus on high-value solutions is not only a revenue driver but also a profitability booster. By offering products with structurally higher gross margins, Micron is positioning itself for sustainable long-term growth. The increased emphasis on high-margin offerings underscores Micron’s resilience and potential to outperform in the semiconductor market.

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