Kevin Cassidy, senior research analyst at Rosenblatt, confirmed a 'Buy' rating for Micron (NASDAQ: MU) shares with a target price of $1,500 until September 23, 2026. This statement comes ahead of the company's anticipated earnings report, which will be released on September 30. Cassidy highlighted key points that could strengthen Micron's position. In his view, additional strategic agreements with customers, rising memory prices, and potential increases in stock buybacks could support the company's long-term trajectory.
The analyst believes that Micron shares remain relatively inexpensive despite concerns that profits may decline with the introduction of new production capacities. He also noted that workloads in artificial intelligence will require increased volumes of dynamic random-access memory (DRAM) and NAND. Micron has already signed 16 strategic agreements with customers, covering approximately 20% of DRAM volume and one-third of NAND volume. These deals are estimated to potentially cover up to 40% of the company's output in the next three to five years. Cassidy emphasized that these agreements are more significant than long-term contracts from previous memory cycles, as they provide the company with greater visibility and include price floors and customer deposits. In response to concerns about declining specifications from clients, the analyst stated that customers are adapting to limited supply, and AI infrastructure will continue to demand significant volumes of DRAM.
Average prices for DRAM and NAND are expected to rise by 10% in the next quarter, which could support higher gross margins. The overall forecast implies $56.5 billion in revenue and an 86% gross margin. Micron's stock buyback restrictions will expire in December, suggesting the possibility of discussions about expanding buybacks during the 2027 fiscal year, which began earlier this month.
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