Micron Technology shares rebounded midday Wednesday even as the union at its Taoyuan chip plant in Taiwan secured authorization for potential strike action. D.A. Davidson analyst Gil Luria raised his price target on Micron to $3,000 from $2,100, maintaining a Buy rating, on the view that memory demand isn't going away anytime soon.
Micron opened in the red Wednesday, then climbed about 4% to $1,087.17. The early decline followed a Reuters report that the union at Micron's Taoyuan plant in Taiwan had won member authorization for a strike, with 99% of votes in favor — though the details of any work stoppage remain under discussion.
Micron told Barron's: "Micron respects our team members' lawful rights and the applicable legal process. We hear the concerns our team members have raised and take them seriously. We remain committed to listening to our team members and engaging with our unions in good faith."
The strike threat isn't new. Barron's previously reported the Taiwanese union is pushing to scrap the existing incentive scheme and replace it with a plan allocating 15% of operating profit to bonuses. Micron had already announced pay deals for Taiwanese production workers worth 35 to 68 months of base salary for fiscal 2026, including a one-time NT$1 million (about $31,377) bonus — apparently not enough to satisfy labor demands.
Luria is driving this rebound. His new $3,000 target implies a 187% increase from Tuesday's closing price of $1,045.56.
"Memory is a lever for better AI performance," he wrote. "AI models generate better results with more memory, run faster with more memory, and have longer context windows with more memory. That observation is driving the increases in demand that is due to outstrip supply in 2027 and 2028."
Memory is the critical component in both personal electronics and data centers, and AI is turning it into the industry's new bottleneck: high-bandwidth memory (HBM) pulls wafer capacity away from ordinary DRAM, Micron's entire HBM supply for 2026 is sold out, and third-quarter DRAM contract prices ran more than 170% above year-ago levels.
Micron shares have soared 444% over the past 12 months as investors bet memory demand stays hot. But since the all-time closing high of $1,213.65 on June 25, the stock has dropped about 12% as concerns crept in that demand will eventually slow.
Barron's notes Micron has locked in customers for more than 75% of next year's production, with 2027 pricing largely settled with large customers. The real test comes in 2028, when Samsung and SK Hynix bring multiple new plants online — seven new memory fabrication and packaging plants in total, according to TrendForce.
Just yesterday, Micron also settled its patent dispute with Netlist for $600 million over a five-year licensing period. Strikes, patents, capacity tests — but as long as AI's appetite for memory holds, Wall Street keeps telling the story.