Bank of America (BofA) has projected a 66% upside for Micron Technology Inc. (NASDAQ: MU), citing increased demand for memory chips driven by artificial intelligence (AI). The forecast comes as the company’s stock was trading around $931 on Tuesday. BofA's analysis highlights the release of Moonshot AI's Kimi K3, which it describes as the largest open-weight AI model, as a significant factor in this demand surge.
AI Memory Demand Growth
According to BofA analyst Vivek Arya, the shift from closed AI models, which consolidate memory demand, to open models like Kimi K3 will multiply memory requirements. Each download of the model necessitates additional memory on individual hardware, creating new demand. BofA noted that while Chinese AI models are priced significantly lower than their Western counterparts, the memory requirements remain substantial, with Kimi K3 needing approximately 1.4 terabytes of high-bandwidth memory per instance.
Market Sentiment and Stock Performance
Micron’s stock was up 5.90% in premarket trading, reaching $916.50, as Nasdaq and S&P 500 futures indicated a positive risk tone. The overall memory demand is expected to increase by 50% to 60% next year, with AI-specific demand potentially rising by 60% to 100%. Analysts maintain a Buy rating for Micron, with an average price forecast of $1,548.86, according to recent reports. The next major catalyst for the stock is the earnings report scheduled for September 22, 2026, with analysts estimating earnings per share of $31.24 and revenue of $50.72 billion.
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The anticipated increase in AI memory demand could boost Micron's stock and influence semiconductor sector valuations. Investors may see increased activity in tech-focused ETFs that hold Micron shares. Watch for the upcoming earnings report on September 22, 2026, which could further impact market sentiment and stock performance.