Big Tech to Boost AI Infrastructure Spending
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: Fool
- Infrastructure Investment Surge: According to FactSet Research, big tech is expected to spend over $500 billion in 2026 on expanding data centers and chip procurement, a trend that will drive growth across the semiconductor industry.
- Micron's Market Potential: As AI workloads grow rapidly, Micron's leadership in high-bandwidth memory, DRAM, and NAND chips positions it to benefit significantly, with stock prices potentially rising by 150% by 2026.
- Earnings Forecast Surge: Wall Street anticipates Micron's earnings per share will triple this fiscal year compared to last year, reflecting strong momentum in AI infrastructure investments and solidifying Micron's market position.
- Valuation Advantage: Despite a 277% increase in Micron's stock price over the past year, its forward P/E ratio remains lower than other major semiconductor companies, indicating substantial upside potential if its valuation aligns with peers, potentially reaching $1,000.
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Analyst Views on MU
Wall Street analysts forecast MU stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for MU is 336.12 USD with a low forecast of 235.00 USD and a high forecast of 500.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
26 Analyst Rating
24 Buy
2 Hold
0 Sell
Strong Buy
Current: 435.790
Low
235.00
Averages
336.12
High
500.00
Current: 435.790
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 Compute and Networking Business Unit (CNBU), Mobile Business Unit (MBU), Embedded Business Unit (EBU), and Storage Business Unit (SBU). CNBU segment includes memory products and solutions sold into the data center, PC, graphics, and networking markets. MBU segment includes memory and storage products sold into the smartphone and other mobile-device markets. EBU segment includes memory and storage products and solutions sold into the intelligent edge through the automotive, industrial, and consumer embedded markets. SBU segment includes SSDs and component-level storage solutions sold into the data center, PC, and consumer markets.
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's 40-Year Investment Return Analysis
- Significant Investment Returns: Since its IPO in 1984, Micron Technology's stock has experienced volatile performance, with an initial $1,000 investment growing to approximately $414,500 by early 2026, indicating a remarkable return of about 414 times, reflecting the company's sustained innovation and strong market demand in the memory technology sector.
- Historical Growth Phases: From the mid-1980s to the mid-1990s, Micron's stock surged over fivefold due to the rise of personal computers and the success of early DRAM chips, with an investment of $1,000 growing to about $5,700 during this period, showcasing the company's pivotal role in technological transformation.
- Impact of the Internet Bubble: In the late 1990s, Micron's market value skyrocketed alongside the internet boom, with an investment of $1,000 worth over $50,000 by March 2000; however, the subsequent dot-com crash led to significant stock price declines, highlighting the substantial impact of market volatility on tech stocks.
- Current Valuation Appears Reasonable: Despite Micron's continued rally in 2026, its current trading valuation at about 12 times forward earnings is lower than the tech sector average of approximately 25, suggesting considerable upside potential in the context of the increasing importance of memory technology.
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Micron Technology's 40-Year Investment Return Analysis
- Significant Investment Returns: Since going public in 1984, Micron Technology's stock has appreciated from an initial $1,000 to approximately $414,500, showcasing its robust growth potential in the memory technology sector, particularly during the personal computer and internet boom.
- Market Volatility Impact: Despite facing significant setbacks during the dot-com crash in 2000, Micron continued to innovate throughout the 2000s and 2010s, ultimately benefiting from the AI boom in 2026, which has driven stock price recovery.
- Reasonable Valuation: Currently, Micron's price-to-earnings ratio stands at about 12 times, lower than the tech sector average of 25 times, indicating that its valuation is not stretched and there is potential for future upside, especially given the increasing importance of memory technology.
- Historical Growth Trajectory: Over the years from 1984 to the present, Micron's stock has experienced multiple fluctuations, yet the returns for long-term investors remain substantial, reflecting the company's adaptability to technological innovation and changing market demands.
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