Despite massive price rallies, analysts still see enormous potential in Micron and Sandisk shares. That’s why memory chips are among the underestimated AI gains.
• AI boom drives demand for memory chips
• Experts see Micron and Sandisk as still being valued favorably despite the rally
• Analysts see enormous upside potential
The chip sector remains one of the most talked-about areas in global stock markets – largely thanks to the ongoing AI boom. Two stocks in particular are currently in the focus of analysts: Micron Technology and Sandisk. Both memory chip manufacturers have achieved massive price gains in recent months: Micron shares have recorded a strong price increase of 124.31 percent since the beginning of the year to most recently reach 640.20 US dollars, while Sandisk shares have recorded remarkable gains of more than 492.43 percent to 1,406.32 US dollars (as of May 5, 2026). According to experts, however, the potential is far from exhausted.
Analysts remain bullish: AI demand continues to drive chip rally
As Barron’s reports, the analysis firm Melius Research has reassessed the two stocks and given both Sandisk and Micron a buy recommendation. The price targets for the next two years are $1,350 for Sandisk and $700 for Micron. For Sandisk, this results in an upside potential of 26.85 percent, while for Micron it could still go up by 35.02 percent compared to the last closing price (as of April 29, 2026).
The main reason for this is the continued strong demand for artificial intelligence. Analysts assume that the AI trend will keep demand for storage solutions structurally high until the end of the decade. Hyperscalers and AI infrastructure providers in particular are considered key drivers.
DA Davison analyst Gil Luria is also extremely bullish and, according to TipRanks, has added Micron shares to coverage with a “Buy” rating and a price target of $1,000 – the highest target among analysts covered by FactSet and TipRanks. The expert therefore sees enormous upside potential of almost 100 percent compared to the last closing price (as of April 29, 2026).
Storage as a core component of the AI wave
The structural change in the market becomes particularly clear through statements from the experts. “It’s time to recognize that storage is a core part of our AI coverage and fits well with AI semiconductors, AI hardware and hyperscalers,” Melius analyst Ben Reitzes was quoted as saying by Barron’s. Memory chips are no longer a cyclical fringe segment, but rather a central component of AI architecture.
“The demand for storage is growing exponentially, so if you need more storage, the math in storage is so unforgiving – you have to assume that prices will continue to rise as AI continues to grow,” said Reitze’s assessment of the industry’s long-term dynamics, according to Barron’s. This factor could become crucial for the revaluation of the sector. While memory chips were highly cyclical and price-sensitive in the past, analysts say AI demand could now ensure a structurally more stable price development.
Valuation remains attractive despite rally
Despite the enormous price rally, valuations remain comparatively moderate according to Barron’s: Micron is currently trading at around 6.4 times expected earnings, Sandisk at around 10.3 times. For comparison: the average of the PHLX Semiconductor Index is around 25 times. This discrepancy could suggest that the market may not yet have fully priced in the new role of memory chips in the AI era.
Memory chips as an underestimated AI winner: Is it still worth getting started?
For investors, the current development in the memory chip sector creates a two-part picture: On the one hand, Micron and Sandisk are already doing well and have enormous price gains behind them. On the other hand, analysts continue to see structural growth from the AI boom, which could support demand for storage solutions in the long term. The decisive factor will be whether the current high demand actually translates into long-term supply contracts and stable price increases. For investors this means: The sector remains rich in opportunities, but after the massive rallies it may also increasingly be a game for long-term investors with a view to the AI infrastructure of the next few years.
Structural change brought about by AI, increasing storage needs and possible long-term supply contracts could mean that the chip sector is facing a new phase of evaluation. Despite the rally, the area remains relevant for investors – and may still be far from exhausted.
Bettina Schneider, editorial team at finanzen.net
This text is for informational purposes only and does not constitute an investment recommendation. finanzen.net GmbH excludes any claims for recourse.
By the way: Micron Technology and other US stocks can even be traded on finanzen.net ZERO until 11 p.m. (without order fees, plus spreads). Open a depot now for free and secure a new customer bonus!
Selected leverage products on Micron Technology
With knock-outs, speculative investors can participate disproportionately in price movements. Simply select the lever you want and we will show you suitable open-end products on Micron Technology
The leverage must be between 2 and 20
Advertising
