Micron Stock vs. Sandisk Stock: One Is a Much Better Buy, According to a Wall Street Analyst

The proliferation of artificial quality (AI) has been a tremendous catalyst for representation spot makers Micron Technology (NASDAQ: MU) and Sandisk (NASDAQ: SNDK). Their stock prices accrued 571% and 3,350%, respectively, successful the past year.

Despite that accelerated terms appreciation, CJ Muse astatine Cantor Fitzgerald says some stocks stay undervalued, though his people prices connote Sandisk is simply a overmuch amended concern today.

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• Muse values Micron astatine $700 per share, implying 29% upside from the existent terms of $542.

• Muse values Sandisk astatine $1,800 per share, implying 52% upside from its existent terms of $1,187.

Here's what investors should cognize astir these semiconductor stocks.

Micron Technology: 29% upside implied by Cantor Fitzgerald's people terms

Micron manufactures representation chips and retention products for smartphones, idiosyncratic computers, automotive systems, and information centers. It is the third-largest supplier of DRAM memory, which includes high-bandwidth representation (HBM), and NAND flash memory, per Counterpoint Research.

Data centers optimized for artificial quality request acold much representation than accepted information centers, and insatiable request has led to a proviso shortage the likes of which the manufacture has ne'er seen. Consequently, DRAM and NAND declaration prices person accrued astir sevenfold implicit the past year, according to The Wall Street Journal.

Micron reported awesome second-quarter fiscal results. Revenue accrued 196% to $23.8 cardinal and non-GAAP (adjusted) nett income accrued 682% to $12.20 per diluted share. CEO Sanjay Mehrotra said, "AI hasn't conscionable accrued request for memory, it has fundamentally recast representation arsenic a defining strategical plus successful the AI era."

Investors person bully crushed to beryllium optimistic. HBM feeds information and models to GPUs astatine precise accelerated speeds, which makes it captious for AI workloads. Micron gained 12 percent points of marketplace stock successful HBM implicit the past year, and the institution is apt to support gaining stock due to the fact that its HBM3E is the fastest and highest-capacity HBM connected the market.

As a caveat, representation spot income are notoriously cyclical. The manufacture is presently successful an upswing, but past says the proviso shortage volition yet go a proviso glut, astatine which constituent representation prices (and Micron's earnings) volition astir apt fall. Wall Street expects the tide to crook astir fiscal 2029, but nary 1 really knows erstwhile the existent rhythm volition peak.