Micron (NASDAQ:MU) heads into its December 17 earnings report with expectations running high after a remarkable 178% surge this year. The stock’s powerful run has been driven by a strong rebound in the memory cycle, soaring demand for high-bandwidth memory (HBM) used in AI accelerators, and improving pricing across both DRAM and NAND. With the fiscal first quarter (the November quarter) now closed, investors are eager to see whether Micron’s results can keep pace with the momentum driving the rally.
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That setup is exactly why Goldman Sachs’ James Schneider thinks sentiment remains constructive heading into earnings. The analyst believes Micron is still positioned to benefit from robust DRAM pricing and expects the market to assume the company will hold – or even widen – its ~20% share in HBM. Schneider adds that strength in traditional DRAM markets should offer additional pricing lift, reinforcing the view that Micron’s fundamentals can continue supporting the rally.
Schneider sees Micron reporting revenue roughly 4% above Street expectations for the quarter and guiding to modest sequential revenue growth in the February quarter, supported by pricing gains. The analyst forecasts revenue, gross margin, and EPS of $13.2 billion, 53.1%, and $4.15 for the quarter, respectively, compared with Street estimates of $12.7 billion, 51.6%, and $3.84. Looking ahead, he expects the February quarter guide to show revenue, gross margin, and EPS of $13.7 billion, 54.9%, and $4.52 vs. the Street at $13.4 billion, 53.6%, and $4.29. For calendar year 2026, Schneider’s revenue and EPS projections are 5% and 10% above consensus, respectively.
Key items from the call that could move the stock include the “sustainability of pricing strength,” as the company is expected to provide more insight on whether the current DRAM pricing upcycle can continue over the next few quarters. The HBM roadmap is also likely to be discussed, including near-term share targets and the potential impact of HBM4 on strengthening the company’s position. Finally, additional commentary on the path forward for gross margins will be important.
Following the earnings release, Schneider expects discussions around the stock to also remain largely focused on the sustainability of DRAM pricing strength. “We believe any future commentary regarding HBM progress and corresponding share targets will be in focus,” the analyst went on to say.
Supported by stronger earnings visibility from “more robust pricing growth,” Schneider has raised his price target from $180 to $205. Interestingly, though his estimates are above consensus, the higher target still implies the shares are overvalued by 12%, and Schneider remains on the sidelines with a Neutral rating. (To watch Schneider’s track record, click here)
3 other analysts are also currently on the MU fence, although they are outnumbered by 25 Buys, all coalescing to a Strong Buy consensus rating. That said, the $231 average price target implies shares will stay rangebound for the time being. It will be interesting to see whether other analysts adjust their Micron models shortly. (See Micron stock forecast)
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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.