Last-Minute Thought: 5-Star Analyst Weighs In on Micron Stock Ahead of Earnings Today

Micron (NASDAQ:MU) is set to draw Wall Street’s attention today after the close, when the memory giant will deliver its fiscal second quarter (February quarter) earnings report.

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A look at the stock’s performance across different timeframes will show investors are in a confident mood. Against a shaky market backdrop, the shares have been surging over the past few sessions, now up 62% year-to-date and 354% over the past year.

It’s clear the market has been rewarding Micron for its stellar growth, driven by strong AI-related demand and soaring memory prices. But given all these pre-earnings gains, the big question is whether the company will deliver a strong enough report for the rally to continue.

That is a point raised by Rosenblatt’s Kevin Cassidy, an analyst ranked among the top 2% on Wall Street. Cassidy expects the company to report a “slight beat-and-raise, supported by constructive memory pricing caused by constrained supply and increasing customer demand.”

But with the share price having roughly doubled since the last report, Cassidy thinks much of the positive momentum appears to be “priced into the shares.” Fiscal 2027 earnings estimates have climbed 126% compared to levels before the 1QF26 report. Meanwhile, the shares have seen some multiple compression, moving from roughly 10.3x prior to that report to about 9.4x now.

“This indicates to us that the market needs to hear that there is little demand destruction from increasing prices and the LTAs are guaranteeing that capacity additions are included and enforceable,” the 5-star analyst went on to say.

Memory price increases are well-known, but Cassidy takes a “somewhat cautious” stance on how these price increases will apply. The analyst thinks that a significant portion of the recent pricing upside is likely linked to incremental bit demand and potential upside within existing long-term agreements (LTAs), while large customers probably already have baseline contracts in place covering volume and pricing. This suggests the gains might not reflect a “full repricing across Micron’s shipment base,” which underpins Cassidy’s more “measured view” for revenue growth and gross margin expansion into FY27.

As such, the analyst thinks that the “magnitude of the beat-and-raise will depend on the percent of bits shipped that had price increases.”

At the same time, with meaningful new wafer capacity, which Cassidy estimates at around 15%, not anticipated until mid-2027, he expects the memory upcycle to extend through at least 4QFY26. Limited supply growth through FY27 should help sustain gross margins above 65%.

On another debated topic, Cassidy thinks concerns around Micron’s HBM4 qualification status appear overblown. Management has indicated that the company is already shipping HBM4 products for revenue. While some industry reports suggest technical problems, the analyst believes that, given the strong demand for HBM4, any issues that do arise will likely be addressed collaboratively between Micron and its customers.

Bottom line, ahead of the print, Cassidy assigns Micron shares a Buy rating alongside a $500 price target, a figure pointing toward 12-month returns of 8%. (To watch Cassidy’s track record, click here)

Overall, the bullish tone is hard to miss. Micron carries a Strong Buy consensus built on 24 Buy ratings versus just one Hold. Yet, the average price target of $473 suggests the stock is already trading close to where analysts think it should be. That figure may not hold for long, with analysts likely to revisit their targets after today’s earnings. (See MU stock forecast)

Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

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