BlockBeats reported on Aug. 18 that Bank of America said SanDisk’s recently announced long-term growth targets could serve as a reference point for a valuation reset at Micron (MU). The bank reiterated its Buy rating on Micron and kept its price target at $1,550, about 61% above the $963 share price used in the report.
At its investor day, SanDisk said it expects sales to grow at nearly 15% annually and gross margin to rise above 80% by fiscal 2030. BofA said that if Micron can sustain similar growth and margin performance, backed by AI-driven demand for high-bandwidth memory, or HBM, and supply discipline, the business may no longer need to be treated entirely as a traditional cyclical memory company.
BofA said Micron’s fiscal 2030 earnings per share could reach $200 to $250. The bank added that if Micron’s AI-related HBM business is awarded a higher valuation, the company’s earnings outlook and valuation upside could widen further. It also said Micron may eventually command a price-to-earnings multiple of 12x to 15x as profitability across the memory industry improves, rather than being priced solely as a conventional cyclical memory stock.
On cash flow, BofA said Micron may increase share repurchases after CHIPS Act-related restrictions expire on Dec. 9, 2026. The bank estimated that by then Micron’s trailing 12-month free cash flow could exceed $80 billion, which in theory would be enough to repurchase stock equivalent to nearly 10% of its market value each year and lift EPS by reducing the share count.
BofA said investors should watch three factors going forward: whether high gross margins can be sustained, whether management can strictly execute its capital return plan, and the direction of HBM demand and pricing.