Prediction: This Artificial Intelligence (AI) Semiconductor Stock Will Go Parabolic in June (Hint: It's Not Nvidia)

For a fewer years now, investors person treated Nvidia arsenic the superior barometer measuring the wellness of the artificial quality (AI) sector. While the GPU person remains a halfway pillar supporting the infrastructure boom, Micron Technology (NASDAQ: MU) has emerged arsenic different large sanction fueling the AI semiconductor space.

On June 24, Micron is scheduled to study net for its fiscal 2026 3rd quarter, and expectations couldn't beryllium higher. Over the past month, Micron's banal terms has skyrocketed astir 50%, earning it a spot connected the abbreviated database of trillion-dollar companies.

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While having that benignant of vertical determination successful the contiguous rear-view reflector would usually suggest that investors behave with caution, I deliberation the setup for Micron banal remains compelling. Its rally whitethorn not beryllium implicit yet.

Why is Micron banal rallying?

Micron's caller surge was acold from speculative. Instead, the company's trajectory is supported by 2 powerful, interlocking fundamentals.

First, AI hyperscalers -- Amazon, Microsoft, Alphabet, and Meta Platforms -- are accelerating their superior expenditures connected AI infrastructure astatine a gait astir analysts didn't expect adjacent a twelvemonth ago. Training ample connection models and handling inference workloads request monolithic amounts of high-bandwidth representation (HBM) and dynamic random-access representation (DRAM) layered connected apical of graphics processing units (GPUs). These representation solutions are precisely the products that Micron delivers.

Second, rising adoption of AI has flipped the representation marketplace from cyclical oversupply to an acute shortage crossed DRAM and NAND. As utilization rates for representation and retention emergence amid, producers similar Micron summation immense pricing power.

What does Wall Street expect for Micron's third-quarter earnings?

Micron's interior gross guidance for its fiscal Q3 is $33.5 billion, positive oregon minus $750 million. Moreover, the institution is calling for net per stock (EPS) of $18.90, positive oregon minus $0.40. Interestingly, Wall Street's statement expectations are a small higher than those medians -- gross of $33.8 cardinal and EPS of $19.31.

Even if Micron's gross lands astatine precisely the midpoint of its guidance, that would inactive correspond 260% year-over-year growth. Furthermore, the company's EPS forecast is astir 10 times what Micron reported conscionable 1 twelvemonth ago. This level of accelerating maturation leads maine to deliberation that with Micron's existent pricing power, it could present a sizable bushed and rise erstwhile the institution reports net aboriginal this month.