Roundhill Memory ETF Surges with 98% Returns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 3 days ago
0mins
Source: NASDAQ.COM
- Outstanding ETF Performance: The Roundhill Memory ETF has achieved a remarkable 98% return since its launch in April, showcasing its strong performance in memory chip stocks and attracting significant investor interest.
- Rapid Asset Accumulation: In just seven weeks, the ETF has amassed $10 billion in assets, making it one of the fastest-growing new ETFs in history, reflecting the strong demand for memory stocks in the market.
- Concentration Risk: The Roundhill Memory ETF's portfolio is highly concentrated, with approximately 74% of its assets in the top three holdings—SK Hynix, Micron, and Samsung—resulting in significantly higher investment risks compared to a typical diversified ETF.
- Market Volatility Warning: While the ETF has performed exceptionally well amid strong growth in the memory market, its strategy of using swap agreements and derivatives to amplify returns may also exacerbate losses during market downturns, necessitating cautious allocation by investors.
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Analyst Views on MU
Wall Street analysts forecast MU stock price to fall
26 Analyst Rating
24 Buy
2 Hold
0 Sell
Strong Buy
Current: 923.520
Low
235.00
Averages
336.12
High
500.00
Current: 923.520
Low
235.00
Averages
336.12
High
500.00
About MU
Micron Technology, Inc. provides memory and storage solutions. The Company delivers a portfolio of high-performance dynamic random-access memory (DRAM), NAND, and NOR memory and storage products through its Micron and Crucial brands. The Company's products enable advancing in artificial intelligence (AI) and compute-intensive applications. Its segments include Cloud Memory Business Unit (CMBU), Core Data Center Business Unit (CDBU), Mobile and Client Business Unit (MCBU) and Automotive and Embedded Business Unit (AEBU). CMBU is focused on memory solutions for large hyperscale cloud customers, and high bandwidth memory (HBM) for all data center customers. CDBU is focused on memory solutions for mid-tier cloud, enterprise, and OEM data center customers and storage solutions for all data center customers. MCBU is focused on memory and storage solutions for mobile and client segments. AEBU is focused on memory and storage solutions for the automotive, industrial, and consumer segments.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Micron Technology Surpasses $1 Trillion Market Cap for First Time
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- Significant Sales Growth: Micron generated $23.8 billion in revenue during its fiscal 2026 second quarter, marking a 196% year-over-year increase, with both cloud memory and mobile client segments contributing $7.7 billion each, reflecting robust demand for AI-related memory solutions.
- Profitability Surge: The severe memory supply shortage allowed Micron to increase its pricing power, resulting in a staggering 756% increase in earnings per share to $12.07 during the second quarter, pushing its trailing 12-month earnings to $21.18, showcasing the company's strong financial performance in the current market.
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- Strategic Partnership: Anthropic named Micron as one of its 'strategic infrastructure partners' during its $65 billion fundraising announcement, which will aid Anthropic in reliably scaling its compute capacity, further solidifying Micron's position in the AI sector.
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- Investment Strategy Recommendation: Baker advises investors to favor cheaper stocks like Micron and Nvidia over high-valuation stocks like Lumentum, which rely on multiple expansions for growth, suggesting that in the event of overall AI sector fluctuations, the cheaper stocks are likely to outperform in the long run.
See More
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- Significant Sales Growth: Micron generated $23.8 billion in revenue during its fiscal 2026 second quarter, marking a 196% year-over-year increase, with both cloud memory and mobile client segments contributing $7.7 billion each, reflecting robust demand for AI-related memory solutions.
- Profitability Surge: The severe memory supply shortage allowed Micron to increase its pricing power, resulting in a staggering 756% increase in earnings per share to $12.07 during the second quarter, pushing its trailing 12-month earnings to $21.18, showcasing the company's strong financial performance in the current market.
- Future Growth Outlook: Management anticipates record revenue of $33.5 billion for the third quarter of fiscal 2026, representing a 260% year-over-year increase, indicating that despite valuation concerns, Micron's long-term growth potential in the AI sector remains highly regarded.
See More
Micron Technology Price Targets Raised to $1,500 Amid Strong Demand
- Price Target Increase: Mizuho raised Micron Technology's price target from $800 to $1,150 while maintaining a 'Buy' rating, anticipating robust memory demand to persist into next year, which implies a 25% upside from the last close.
- Strategic Partnership: Anthropic named Micron as one of its 'strategic infrastructure partners' during its $65 billion fundraising announcement, which will aid Anthropic in reliably scaling its compute capacity, further solidifying Micron's position in the AI sector.
- Strong Market Performance: Micron's shares rose 1% in pre-market trading on Thursday, with a year-to-date increase of 224%, reflecting strong market confidence in its future growth, particularly amid surging demand for data centers and AI systems.
- Optimistic Earnings Outlook: Micron is expected to report a 263% year-over-year revenue increase to $33.8 billion in its fiscal third-quarter results on June 24, setting a record high, with adjusted earnings projected to rise over 900% to $19.29 per share, further boosting investor confidence.
See More
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- Milestone Achievement: Micron has achieved a historic milestone by increasing its market cap from $500 billion to $1 trillion in just 48 trading days, marking it as the fastest company to reach this threshold, which underscores its robust growth potential in the memory chip market.
- Strong Financial Performance: In its most recent quarter, Micron's revenue nearly tripled to $23.8 billion, while net income surged nearly tenfold to $13.8 billion, with a 67.6% operating margin indicating significant profitability amid market tightness.
- Structural Supply-Demand Tightness: Management highlighted that the gap between supply and demand in the memory market is structural and expected to persist beyond 2026, with key customers only able to meet around 60% of their memory needs, indicating ongoing constraints and future growth potential.
- Optimistic Future Outlook: Micron anticipates third-quarter revenues between $32.75 billion and $34.25 billion, with adjusted earnings per share projected at $18.75 to $19.55, and analysts generally believe the company will exceed these targets, reflecting strong market confidence in its future performance.
See More
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- Optimistic Earnings Outlook: Management anticipates third-quarter revenue between $32.75 billion and $34.25 billion, representing a 262% year-over-year increase, with adjusted earnings per share expected to soar from $1.91 to $19.21, reflecting strong demand and profitability in the memory sector.
- Supply-Demand Tightness: Executives indicated that the structural gap between supply and demand in the memory market is expected to persist beyond 2026, suggesting that memory prices will remain elevated, which will drive sustained profitability for the company in the coming years.
- AI-Driven Growth: With companies like Nvidia proactively ordering memory products, Micron's growth prospects appear increasingly optimistic, indicating strong market demand for its offerings, which could continue to propel its stock price higher in the years ahead.
See More
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- Milestone Market Cap: Micron achieved a remarkable feat by soaring from a $500 billion to a $1 trillion market cap in just 48 trading days, marking the fastest ascent in history and highlighting its robust growth potential in the memory chip sector, likely attracting increased investor interest.
- Strong Financial Performance: In its latest earnings report, Micron's revenue nearly tripled to $23.8 billion, with net income surging to $13.8 billion and an operating margin of 67.6%, indicating sustained strong demand in the memory market and potential for further profitability enhancement.
- Sustained Market Tightness: Management emphasized that the supply-demand gap in the memory market is structural and expected to persist beyond 2026, with some key customers only able to meet 60% of their memory needs, providing robust support for Micron's long-term growth.
- Favorable Industry Trends: With increasing demand from companies like Nvidia, Micron's future product demand is also rising, and although the memory market is cyclical, the AI boom could create lasting growth opportunities, positioning Micron's stock for further upward movement.
See More
Gavin Baker's Insights on AI Stock Valuations
- Outstanding Returns: Gavin Baker achieved a compound annual return rate exceeding 19% while managing the OTC portfolio at Fidelity, outperforming 99% of his peers, showcasing his exceptional investment acumen and market insight.
- Large Portfolio Management: At Atreides Management, Baker oversees approximately $7 billion in public and private investments, and although his complete returns are not disclosed, his Sharpe ratio of 2.46 significantly exceeds the industry average, indicating high returns with controlled risk.
- AI Sector Valuation Analysis: On the All-In podcast, Baker highlighted the 'cross-sectionally inefficient' valuations in the AI sector, noting that memory stocks like Micron and Sandisk are currently undervalued, while Nvidia's low P/E suggests potential for price appreciation.
- Investment Strategy Recommendation: Baker advises investors to favor cheaper stocks like Micron and Nvidia over high-valuation stocks like Lumentum, which rely on multiple expansions for growth, suggesting that in the event of overall AI sector fluctuations, the cheaper stocks are likely to outperform in the long run.
See More
