U.S. Memory Stocks Stage Strong Rebound, Morgan Stanley Report Forecasts Long-Term Memory Shortages

 

During Monday’s U.S. trading session, memory-related stocks rallied across the board. SanDisk closed up 13.33%, Western Digital rose 8.43%, while Micron Technology and Seagate Technology gained 7.99% and 6.69%, respectively.

 

Earlier in the day, top U.S. investment bank Morgan Stanley raised its price targets for both SanDisk and Micron, citing “tightness across the entire memory market that continues to intensify” and arguing that the recent sell-off in semiconductor stocks “appears unjustified.”

 

In the report, Morgan Stanley lifted its Micron target from $325 to $338 per share and its SanDisk target from $263 to $273, while reiterating Overweight ratings on both and naming Micron its top pick.

 

Analyst Joseph Moore said memory market conditions “continue to improve,” with DDR5 DRAM facing the most severe shortages and “a sense of panic emerging in the market — people can’t buy product at any price.”

 

Although consumer-grade NAND does not appear quite as tight, Morgan Stanley still observed “generational supply shortages across the entire industry.”

 

The report pushed back against concerns that the current cycle may be weakening. Morgan Stanley noted that capital spending at Samsung and SK Hynix is increasing, while Micron has described its own capex plans as facing “upward pressure.”

 

Moore stressed, however, that these developments need to be viewed in context: with cloud demand accelerating, suppliers are facing “a completely sold-out market,” and current spending levels “appear unlikely to catch up with demand over the next several quarters.”

 

Moore also dismissed claims from some PC makers that supply is ample, stating that “there is simply not enough inventory across the industry in aggregate.”

 

Morgan Stanley believes Nvidia will likely be able to pass on rising memory costs, while other chipmakers will face greater margin pressure.

 

The bank raised its Micron 2026 calendar-year EPS estimate by 15% and its SanDisk estimate by 20%. Morgan Stanley further noted that tightening supply combined with robust AI-driven demand means “multiple additional upward revisions are likely in the coming quarters.”