Memory Prices Surge: Is a Second Rally for Micron, SanDisk, SK Hynix Beginning?
Memory stocks have already delivered massive gains, but a structural supply shortage widening through 2028 suggests a second rally may be underway. Analysis from 24/7 Wall St.
According to a report from 24/7 Wall St., memory prices are skyrocketing due to a structural supply shortage that analysts expect to widen through 2028. This shortage, driven by limited production capacity and surging demand from AI and data centers, could fuel a second rally for memory stocks like Micron (MU), SanDisk, and SK Hynix.
Details of the Structural Shortage
The current shortage is not cyclical but structural, meaning supply will lag demand for years. Analysts note that building new fabs takes time, while demand for high-bandwidth memory (HBM) and DDR5 is accelerating due to AI.
Analyst Rationale
Analysts upgrading memory stocks cite:
- Persistent supply gap through 2028.
- Growing demand from cloud and AI sectors.
- Improving margins as prices rise.
Context
Memory stocks have already rallied sharply in 2024-2025, but the report suggests the first wave may not be the last. Micron's recent performance has been strong, but valuations remain reasonable relative to growth potential.
What to Make of It (Neutral)
While the outlook is positive for memory stocks, investors should consider risks such as demand slowdown or unexpected capacity additions. The structural shortage provides a solid foundation for further upside, but timing and valuation remain key.
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