Is It Too Late to Consider Micron After a 252.1% Surge on AI Optimism in 2026
Simply Wall St
Sun, January 4, 2026 at 6:15 PM EST
4 min read
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If you are wondering whether Micron Technology is still a buy after its huge run, you are not alone. This article will break down what that share price really implies about its value.
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The stock has rocketed, up 10.8% over the last week, 33.0% in a month, and an eye‑catching 252.1% over the past year. This naturally raises the question of how much upside is actually left from here.
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Micron has been riding a wave of optimism around AI infrastructure and high bandwidth memory, with investors betting that its key role in supplying advanced memory chips will translate into structurally higher earnings power. At the same time, broader enthusiasm for semiconductor names has pushed capital into the sector, amplifying price moves as sentiment has shifted from cautious to opportunistic.
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Despite that excitement, Micron currently scores a 3/6 valuation check score. This suggests it looks undervalued on some metrics but not others. In the sections ahead we will walk through those methods in detail, before finishing with a more holistic way to think about Micron’s true worth.
Approach 1: Micron Technology Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow model estimates what a business is worth by projecting the cash it can generate in the future and then discounting those cash flows back to today in dollar terms.
For Micron Technology, the 2 Stage Free Cash Flow to Equity model starts from last twelve month free cash flow of about $5.8 billion. It then uses analyst forecasts and longer term extrapolations by Simply Wall St to map out the next decade. Analyst estimates see annual free cash flow rising into the low to mid $20 billion range over the next several years, with later years tapering to more modest growth as the business matures.
When those projected cash flows, including a 2030 estimate of around $20.4 billion, are discounted back, the intrinsic value comes out at roughly $192.51 per share. Compared with the current share price, this implies the stock is about 63.8% overvalued on a pure cash flow basis, which indicates that expectations may already be running ahead of fundamentals.
Result: OVERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Micron Technology may be overvalued by 63.8%. Discover 875 undervalued stocks or create your own screener to find better value opportunities.
Story Continues
Approach 2: Micron Technology Price vs Earnings
For profitable businesses like Micron, the price to earnings, or PE, ratio is a useful way to gauge how much investors are willing to pay for each dollar of current earnings. In general, faster growing and less risky companies tend to justify higher PE ratios, while slower growth or higher uncertainty usually warrant lower multiples.
Micron currently trades on a PE of about 29.8x. That sits below the broader Semiconductor industry average of roughly 37.3x, and well under the approximate 63.2x average of its peer group, which at first glance makes Micron look relatively inexpensive against other chipmakers.
However, Simply Wall St goes a step further with its Fair Ratio, a proprietary PE estimate that reflects Micron’s specific earnings growth outlook, profit margins, risk profile, industry, and market cap. For Micron, this Fair Ratio is 49.6x, which suggests investors could reasonably pay a higher multiple than the current 29.8x given its characteristics. Because the actual PE is meaningfully below this Fair Ratio, the multiple based view indicates that Micron’s shares may be undervalued despite their strong run.
Result: UNDERVALUED
PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1464 companies where insiders are betting big on explosive growth.
Upgrade Your Decision Making: Choose your Micron Technology Narrative
Earlier we mentioned that there is an even better way to understand valuation. Let us introduce you to Narratives, a simple way to attach your story about Micron, including your assumptions for future revenue, earnings, margins, and fair value, to the hard numbers. This means your view is explicitly linked from business story to financial forecast to fair value, then compared with today’s share price to guide buy or sell decisions. On Simply Wall St’s Community page, millions of investors build these Narratives and they update dynamically as new news or earnings arrive. One investor might reasonably see Micron as worth about $95 per share, while another, using more optimistic assumptions, puts fair value closer to $250. Both can clearly see how their different expectations about AI demand, margins, and multiples flow through to a concrete number that can be tracked and refined over time.
Do you think there's more to the story for Micron Technology? Head over to our Community to see what others are saying!
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include MU.
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