Memory Stocks MU & SKHY Look Cheap for a Reason
Investors are still treating the memory boom like it has an expiration date. ⏳
Forward estimates point to Micron reaching roughly $220B in operating profit by 2028, while SK Hynix is estimated at around $337B.
The market clearly isn't buying those numbers yet.
$Micron Technology(MU)$ trades at roughly 6x forward P/E, while $SK hynix(SKHY)$ sits around 4x. The argument is familiar: memory is a commodity business, supply will catch up, and revenues will start falling next year.
We’ve heard this story before. 👀
Back in 2023, plenty of investors also dismissed Nvidia's forward earnings estimates and questioned whether its growth could last.
Three years later, Nvidia was still delivering 100% YoY revenue growth in its latest quarter.
Memory could be facing a similar disconnect.
Demand for memory is running ahead of supply, while expectations for when the shortage will finally ease keep getting pushed further out — first 2028, then 2029, and now even 2030 in some forecasts.
That changes the setup.
If memory companies continue beating estimates and the shortage lasts longer than the market expects, investors may eventually have to rethink how they value the group. 📊
The big question for next year isn't simply whether memory is cyclical.
It's whether the market is underestimating how long this cycle can actually last. 🔥
Markets are always moving - and sometimes, the best move is knowing what works for you.
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