Micron makes the case that it's better for longer

Morgan Stanley maintains Overweight on Micron Technology (MU.US) with a $1,200 price target, arguing the memory upturn is "better for longer." The debate has shifted from "how good can it get" to "how long it can stay good," and management extended qualitative guidance out to 2028, expecting supply/demand to be tighter in both 2027 and 2028 than this year, with LTA coverage extending in some cases through 2031. Over the last three quarters Micron beat and guided EPS 20-40% above consensus; this quarter it beat by 5% and guided 6% above, which may be the new normal as visibility improves. HBM repricing is a key catalyst still to come: the "cloud memory" unit is one-third of revenue but carries the lowest gross margin (83%) due to HBM contracts signed when DRAM pricing was much lower;