Micron’s shares surged more than 10.5% on the first trading day of 2026, building on a remarkable 247% rally over the past year. This jump reflected growing investor confidence in the company’s ability to capitalize on a tightening memory market. Volume on Jan. 2 exceeded the 30-day average by nearly 20%, underscoring the broad participation in the stock’s early-year advance.

Persistent capacity shortages in DRAM and NAND flash have pushed memory chip prices up by an estimated 20%–25% sequentially in the current quarter, according to Bernstein analyst Mark Li. Data-center customers racing to deploy AI workloads are outpacing Micron’s production ramp, leaving the company sold out of its high-bandwidth memory (HBM) capacity for calendar 2026 and able to fulfill only half to two-thirds of demand in its non-HBM business for key accounts.

Micron’s guidance for its fiscal second quarter, ending in February, calls for non-GAAP earnings of $8.42 per share, a 440% year-over-year increase that far exceeds the 167% growth recorded in the prior quarter. Bernstein raised its price target to $330 and rated the stock “outperform,” while consensus forecasts now see full-year fiscal 2026 EPS at $32.22—a nearly fourfold increase from the prior year—and fiscal 2027 EPS at $39.39 per share.

Trading at roughly nine times forward earnings against the Nasdaq-100 average of 26, Micron’s valuation reflects skepticism that may prove misplaced if robust AI-driven memory demand persists. Back-of-the-envelope estimates, multiplying the consensus $37.29 in EPS over the next four quarters by a 26× multiple, suggest a year-end share price approaching $970—more than three times the current level—if the firm achieves sustained price and margin expansion.