Wells Fargo analyst Aaron Rakers reiterated an Overweight rating and $95.00 price target on Micron Technology (NASDAQ: MU)

The analyst comments "This morning (2/26) MU announced that it has commenced the volume production of their HBM3E solutions; announcing that their 24GB 8-High (8H) HBM3E is integrated in NVIDIA's H200 GPUs. MU's 36GB 12H HBM3E solution now sampling. Micron HBM3E Quick Specs: Micron continues to highlight performance attributes— providing pin speed at >9.2Gb/s and >1.2TB/s total memory bandwidth. The company also reiterates its power consumption advantage w/ a noted ~30% lower power consumption vs. competitive offerings. Micron's HBM3E design leverages the company's 1-beta DRAM, advanced through-silicon via (TSV), and other innovations to enable differentiated packaging w/ 2.5D / 3D packaging. As a reference to 1-beta DRAM, we would note that TrendForce estimates Micron has led its peers in terms of 1-beta with this process accounting for ~8% of its 4Q23 production vs. Samsung and SK Hynix at 0% and 1% of their respective bit output. SK Hynix, the leader in HBM, has noted that it will ship its HBM3E solutions in 1H2024—noted to provide peak bandwidth at 1.15TB/s. In addition to noting that their 24GB 8H HBM3E solutions are being integrated into NVIDIA's new H200 (144GB) datacenter GPUs, the company notes that it is also sampling its 36GB 12-High HBM3E solution that provides >1.2TB/s memory bandwidth in March 2024. Micron's HBM3E and future solutions will be highlighted at NVIDIA's upcoming (March 18th) GTC event. NVIDIA's H200 will initially ship in 2Q24. MU will report F2Q24 results on March 20th. As a reminder, Micron has noted that they expect their HBM3E solutions to drive 'several $100Ms' of revenue in fiscal 2024; targeting a similar market share as their overall DRAM market share in 2025 (note: Micron had a ~23% DRAM industry revenue share in 2023). We think this expectation is underpinned by the complexities / visibility of HBM3E design + qualification cycles."

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Shares of Micron Technology closed at $86.00 yesterday.