Key Takeaways
- Micron shares declined 1.4% to $977.92 in Friday’s premarket session following SK Hynix’s Nasdaq ADR debut
- SK Hynix’s $26.5 billion capital raise could intensify competitive dynamics in the memory chip market
- Bank of America maintains Buy recommendation on Micron with a $1,550 price objective
- Micron expanded its U.S. capital expenditure commitment to $250 billion from $200 billion by 2035
- Analysts project Big Tech will allocate approximately $1.5 trillion toward cloud and AI infrastructure by 2027, with memory comprising 35–40%
Micron shares retreated 1.4% to $977.92 during Friday’s premarket hours as South Korean competitor SK Hynix launched its American depositary receipts on the Nasdaq exchange, marking its official entry into U.S. equity markets.
The decline followed a strong Thursday session where Micron surged 7.8% to $1,022. Year-to-date in 2026, the stock has delivered triple-digit gains, despite retreating from peak levels exceeding $1,200 reached in late June.
SK Hynix’s entrance into American trading venues provides investors with an alternative avenue for gaining exposure to the memory semiconductor sector. According to Barron’s, the ADRs present a more affordable entry point into the memory chip rally relative to Micron, potentially prompting some market participants to diversify their holdings across both companies.
SK Hynix is simultaneously conducting a $26.5 billion capital raise through this listing. These proceeds could fund expanded production capabilities, potentially intensifying competitive pressures for Micron in future periods.
Despite this development, Wall Street analysts remain optimistic. BofA Global Research’s Vivek Arya reaffirmed his Buy recommendation on Micron this week, establishing a $1,550 price objective.
Arya projects that Big Tech expenditures on worldwide cloud and AI infrastructure will reach approximately $1.5 trillion by 2027 — representing a 40% to 50% increase from present levels. Memory components are anticipated to constitute 35% to 40% of that aggregate spending.
“We believe the market is underestimating the transition toward longer-duration agreements and more predictable pricing,” Arya wrote. “As memory evolves from a cyclical commodity to a strategic AI enabler, multiples should expand.”
His $1,550 valuation derives from a sum-of-the-parts framework — assigning approximately 3x price-to-book for Micron’s conventional memory operations and a 31x price-to-earnings multiple for its high-bandwidth memory division, both calculated using 2028 projections.
Micron Expands Domestic Investment to $250 Billion
On Thursday, Micron revealed plans to increase its U.S. investment blueprint to $250 billion extending through 2035, representing an upward revision from its prior $200 billion pledge. The chipmaker stated this enhancement advances its objective of manufacturing 40% of its DRAM production on American soil.
The strategy encompasses a $100 billion initiative in New York that was originally unveiled in 2022, with manufacturing operations not anticipated to commence until 2030.
Micron additionally announced up to $3 billion in investments aimed at fortifying the domestic semiconductor supply ecosystem. This includes $500 million in financial backing for GlobalWafers to develop a silicon wafer manufacturing facility in Sherman, Texas, supported by a decade-long supply contract.
Industry Observers Dismiss Oversupply Concerns
Hendi Susanto, portfolio manager at the Gabelli Global Technology Leaders ETF, rejected fears about excessive capacity entering the marketplace.
“The main players — Samsung, SK Hynix, and Micron — have demonstrated discipline on capacity expansion for many years now,” Susanto said. “The current market outlook is still expecting demand higher than supply in 2027.”
Micron stock concluded Thursday’s trading session up 4.52% before experiencing the premarket decline on Friday.
