- AVGO
- MU
- NVDA
Micron Technology (NASDAQ:MU) andBroadcom(NASDAQ:AVGO) have been among the biggest beneficiaries of the ongoing artificial intelligence (AI) revolution. Both have seen their shares soar over the past few years as a result. Micron is up about 1170% since 2021, while Broadcom has climbed 647% over the same period. Is there more upside left for these companies? Wall Street certainly thinks so.
Micron’s average price target (according to Yahoo! Finance) is currently $1,515.11, implying an upside of about 66% from current levels. Meanwhile, Broadcom has an average price target of $526.30, so the Street thinks it could rise almost 46% over the next year. Should investors rush to buy shares of Micron and Broadcom based on these price targets? Let’s find out.
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1. Micron Technology
Micron is a leading maker of memory chips. The company’s products are in high demand right now amid the massive AI infrastructure build-out. Data centers need large numbers of memory chips to function, and Micron is cashing in on a current industry shortage, which gives the company significant pricing power. Micron has posted excellent financial results of late.
In the third quarter of its fiscal year 2026, which ended on May 28, Micron’s revenue increased by 346% year over year to $41.46 billion. That was more in one quarter than the company’s entire top line during its fiscal year 2025. That’s impressive, and it may not even have been the most eye-popping thing in Micron’s financial update. The company’s adjusted earnings per share (EPS) soared 1,215% year over year to $25.11.
The question is whether Micron can maintain that pace. If the memory chip shortage continues for a while, it might. But how likely is that? According to some experts, the memory bottleneck will last at least until 2028. If that’s the case, Micron could continue crushing broader equities for the next couple of years. Note that Micron is trading at just 6.2x forward earnings, versus an average of 20.9x for information technology stocks.
That valuation makes Micron look like a bargain at first glance, considering how fast its EPS is growing. But many investors worry that the sector’s cyclicality means Micron’s revenue and earnings growth will soon decrease substantially. That’s a reasonable assumption based on solid historical precedent.
