Why Micron Stock Dropped Again Today
The Motley Fool • • business
Key Points:
- Micron's stock has been steadily declining since its earnings report, dropping an additional 5.6% on Monday despite positive analyst support.
- RBC forecasts a 50% growth in DRAM prices by Q2 2026 and continued growth into 2027, highlighting Micron's ramp-up in HBM4 production to capitalize on higher prices and increased demand from data centers.
- While RBC believes rising demand for HBM in data centers will offset smartphone demand declines and reduce industry cyclicality, skepticism remains about Micron escaping its cyclical stock nature.
- Alphabet's new compression technology, designed to reduce memory size while enhancing performance, addresses high memory prices and supply bottlenecks, potentially limiting Micron's pricing power.
- As competitors increase production and companies adopt memory-efficient technologies, HBM prices are likely to fall again, which could lead to further declines in Micron's stock price.
