Micron shares rose 3.7% in premarket trading on Monday after closing at a record $1,133.99 on Thursday. Analysts believe the memory chip boom will continue, even with some new risks. In South Korea, SK Hynix gained 5.6% and passed Samsung Electronics to become the country’s most valuable company. Below is a look at recent research on how long the rally might last and where challenges could arise.
According to ING economist Min Joo Kang, the memory chip boom is likely to last at least until early 2027. High-bandwidth memory prices are expected to rise by 20% to 30% in 2026, and Kang predicts that chip export growth will remain strong into early 2027, driven by demand from AI infrastructure. HBM is still the main driver of this cycle, as AI servers need a lot of memory, but manufacturing limits how fast supply can grow.
Looking further ahead, the situation becomes less clear. Chinese companies ChangXin Memory Technologies and Yangtze Memory Technologies are quickly increasing their production, even though their customer base is limited in Western markets due to national security issues. The Wall Street Journal reported on Friday that Yangtze Memory is building three new factories in China, which will more than double its production capacity by the end of 2027. Kang expects DRAM prices to start falling around 2028 as these new Chinese factories begin operating and supply conditions improve.
Micron’s stock has risen more than 800% in the past year. Its forward price-to-earnings ratio has grown a lot as investors expect a longer period of strong earnings, compared to the usual ups and downs in the industry. The increase in Chinese production is the biggest short-term risk to this outlook, but current players likely have at least another year of good pricing before supply rises significantly.
