Micron CFO is confident in HBM, storage stocks rise across the board

Micron executives expressed positive statements about the competitiveness of next-generation high-bandwidth memory chips at an industry conference, alleviating market concerns about its lag behind competitors in the HBM4 field. This statement, combined with Wall Street analysts raising target prices, boosted the overall strength of the memory chip sector.

Overnight, Micron's Chief Financial Officer Mark Murphy stated at the conference that the company has begun mass production and shipment of HBM4 chips. "We are very excited about HBM," Murphy said. This statement directly addressed market concerns that Micron might lag behind SK Hynix and Samsung Electronics in the HBM4 competition.

Morgan Stanley analyst Joseph Moore significantly raised Micron's target price from $350 to $450 on Wednesday, maintaining an overweight rating. Moore pointed out that while SK Hynix will supply HBM4 products to Nvidia in the first quarter of this year, Micron should be able to achieve the same goal starting in the second quarter.

The surge in demand for HBM chips has been a key driver behind Micron's stock price more than tripling over the past 12 months, with Micron's stock rising 6.6% to $410.34 on Wednesday. Confirmation that the company has achieved mass production and commercial shipment of HBM4 marks progress in this critical technology area in line with expectations.

Micron's significant rise has driven the overall strength of the memory chip sector, with SanDisk seeing a maximum intraday increase of 13.20%, Western Digital rising 4.26%, and Seagate Technology closing up 2.88%.

Mass Production Progress Alleviates Market Concerns

HBM4 is a new generation of high-bandwidth memory technology that is crucial for supporting cutting-edge AI chips from companies like Nvidia. Previously, the market was concerned that Micron might be outpaced by its Korean competitors in this field, affecting its market share in high-margin products.

Morgan Stanley's Moore noted in a research report that while SK Hynix will supply HBM4 to Nvidia in the first quarter, Micron will also be able to supply starting in the second quarter, with the time gap not being significant.

Moore expects a new round of significant price increases in the first quarter, and the supply growth in 2026 will hardly alleviate the anticipated severe shortages. "We expect prices to rise further throughout the year," he wrote.

Karl Ackerman, a senior analyst at BNP Paribas Securities Research, believes that market concerns about Micron's HBM4 position have been overstated. He pointed out that even if Nvidia does not allocate initial HBM4 orders to Micron, it may balance the supply chain by ordering other memory components.

The strong demand for HBM chips has led to shortages of other types of memory chips, driving prices up across the industry. Ackerman analyzed that if Micron replaces 20% of its LPDDR5X memory module share with 20% of its HBM4 share, the profits generated in Nvidia's Vera Rubin computing rack would be comparable This supply and demand pattern has created a favorable pricing environment for memory chip manufacturers such as Micron. The high profit margin characteristics of HBM chips make them a key product line driving Micron's performance growth