In its latest 13F filing, David Tepper’s Appaloosa Management reduced its stake in Micron Technology after the memory chipmaker’s shares surged on tight supply and robust demand for high-bandwidth memory (HBM). At the peak of the semiconductor shortage in 2021, Micron accounted for roughly 10% of the fund’s equity portfolio; by the end of Q3 2025 it had been trimmed to just over 1%. Tepper’s decision to lock in gains follows Micron’s pre-announcement of third-quarter fiscal 2026 earnings showing strong pricing power and continued industrywide hesitancy to expand capacity, which propelled the stock higher.

Micron reported fiscal Q1 2026 revenue of $13.6 billion, a 57 percent year-over-year increase driven by accelerating adoption of its HBM products in AI data centers and networking equipment. Gross margin climbed toward 57 percent in Q1, and management projects a further expansion to approximately 68 percent in Q2 as memory prices remain elevated. This top-line strength underpins both capital returns—Micron spent $1 billion on share repurchases and paid $1.7 billion in dividends over the past two years—and ongoing investment in capacity.

Advanced memory solutions are sold out through calendar 2026, according to Micron’s December guidance, as global HBM demand outpaces supply by a wide margin. To alleviate constraints, the company has committed over $200 billion to expanding U.S. fabrication capacity, including upgrades to its Virginia campus and new fabs in Idaho and New York. These projects aim to secure multiyear customer contracts and lock in pricing power even as cyclical inventory cycles eventually normalize.

Despite a year-to-date share gain exceeding 30 percent, Micron trades at a forward P/E in the low teens, well below the semiconductor peer group average. Wall Street consensus forecasts earnings per share of roughly $33 for fiscal 2026, rising to over $40 in fiscal 2027, with several firms lifting price targets to the $350–450 range. The combination of strong contract backlog, margin leverage and a conservative valuation underpins a consensus Buy rating among analysts.