Micron Earns Third PT Raise in a Day

Analysts are falling in love with Micron Technology Inc. (MU).

Shares in the Idaho-based chipmaker surged 9 percent on Monday after three brokerages, Nomura Instinet, Evercore ISI and Mizuho, all raised their price targets on the stock.

The most-bullish assessment came from Instinet’s Romit Shah. The veteran chip analyst nearly doubled his price target for Micron to $100 from $55, predicting that the stock is in the "early stages of another major breakout”. In a research note, reported on by Barron’s, Shah said the company looks set to continue benefiting from soaring demand for dynamic random-access memory (DRAM) and NAND flash memory chips. He expects a strong trading outlook to pave the way for a first-time dividend, share buyback program and renewed M&A speculation.

"We see DRAM pricing resuming an upward trend in Q2, a first-time dividend and share buyback announcement in May, continued margin expansion in NAND and increased M&A discussion as important catalysts," he said. (See also: Why Micron's Stock Bulls May Be Wrong.)

Evercore ISI’s CJ Muse was similarly bullish about Micron’s ability to capitalize on a favorable market backdrop. The analyst noted that the high-barrier-to-entry DRAM industry has now been narrowed down to just three players. Muse has been encouraged by how Micron, one of these three companies, is taking advantage of this strong position, prompting him to hike his price target on the stock to $80 from $60.

Hours after Shah and Muse upgraded their forecasts, Mizuho’s Vijay Rakesh followed suit. Rakesh said he had just returned from a trip to to the Asia Pacific region, where he met with many of the major DRAM and flash memory chip manufacturers. During his visit, the analyst realized that demand for Micron’s products is strong enough to offset some “softness” in Apple iPhone X sales and other electronics in China. Those observations led him increase his price target on the stock to $66 from $55. (See also: Micron May Rise 12% As Analysts Grow More Bullish.)