Bank of America analyst Vivek Arya reaffirmed a Buy rating on Micron and a $1,550 price target, about 45% above its Sept. 23 close, ahead of its Sept. 30 results; BofA says the bull case depends on gross margins staying near mid-80%.
Micron’s Q3 revenue more than quadrupled to a record $41.46 billion, adjusted earnings exceeded expectations and gross margin reached 84.9%; it forecast $50 billion in fiscal Q4 sales. BofA cites industry checks showing most DRAM average selling prices rose 20%–30% sequentially in Q3 and NAND prices rose more than 15%. Hyperscalers are reportedly agreeing to pay higher DRAM prices in the first half of 2027 than in late 2026, which BofA says could help sustain margins and support $150–$200 in fiscal 2027 earnings per share.
BofA says Micron could resume share buybacks after Dec. 9, when restrictions tied to its CHIPS Act grants expire; it estimates trailing free cash flow could fund retirement of 8%–10% of outstanding shares. The bank expects fiscal 2027 capital spending of $45 billion–$48 billion, up more than 60%, but says over half the increase would fund longer-term cleanroom construction. It models memory prices falling more than 10% in 2028 as new capacity arrives in the second half of 2027; weaker data-center spending, Chinese competition and market-share losses are additional risks.
