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Micron upgraded to Equalweight by Morgan Stanley on HBM chips

Morgan Stanley is upgrading semiconductor stock Micron Technology (MU) to Equalweight from Underweight while raising its price target to $130 per share. Catalysts Anchors Madison Mills and Seana Smith weigh in on Morgan Stanley's forecasts for Micron based on its high-bandwidth memory (HBM) chips.

For more expert insight and the latest market action, click here to watch this full episode of Catalysts.

This post was written by Luke Carberry Mogan.

Video transcript

Well, my shares are in the green today.

This comes after Morgan Stanley upgraded the semiconductor company to equal weight that is up from the previous rating of underweight.

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They also increase the price target for this name to 130 bucks a share that is up from 98 F citing the upside potential of a high bandwidth memory.

That is the key kind of area of growth for my moving forward.

We are also seeing upgrades from some other folks on the street as well.

But specific to more Stanley predicting that micro could announce positive financial results due to the ramp up phase of what's called that HBM supply, a possibility that HBM supply can become excessive eventually.

But for now, it does appear to be a positive influence on the company's outlook amid growing optimism regarding some of the memory market that we have here.

Yeah, this is a stock and you can see on the screen right now over the last six months of 65% in the last month alone, I believe it's up just around 20%.

So even Stanley Joe Moore calling out himself saying that we belatedly are coming around to this drive up that we're seeing a rampant growth here for the narrative surrounding mi you can see some of that excitement play out within the stock and the stock performance here over the last several months.

But I think the question going forward when it comes to memory valuation, exactly what that looks like the discount of evs to sales, what they're seeing there.

I think obviously goes into this uh re rating that we are seeing the upgrade that we are seeing here for Mike Ron.

And then I think this is gonna be an active sector, right?

When we talk about the results that we have on top on Wednesday.

Ultimately, what this means for so many other smaller players within this space, clearly not a massive rival here to committee up until this point.

But again, when we talk about the A I adoption to when we talk about chip demand right now, at least when it comes to electronics, whether or not the worst is behind us at this point.

When it comes to see the street getting a bit more positive on several of these names, we're certainly seeing that lift the broader index as well.