UBS: Micron HBM Tighter Than Expected, NAND Short-Term Noise Does Not Alter Long-Term Buy Logic

TechFlow news, according to TechFlow Research, UBS pointed out in its research report on August 10 that Micron's Q3 NAND contract price increase fell from an expected 28% to around 20%, but DRAM is tighter than expected. HBM4 and HBM4E pricing continues to exceed expectations; NVIDIA lowered the HBM specifications for VR300 due to supply constraints, yet total HBM consumption in 2027 increased from 58.7 billion Gb to 61.5 billion Gb, and the year-on-year increase in HBM blended average price was raised from 67% to 79%. Micron's 2027 HBM revenue is expected to reach $26.35 billion, with ASP rising from $20.03 per Gb to $28.48.

UBS maintains a Buy rating, with a target price of $1,625; the current stock price of $877 implies approximately 85% upside potential. DRAM supply tightness is expected to last at least until Q2 2028; NAND short-term pricing pace slows down but enterprise SSD demand offsets consumer-side weakness. YMTC is shifting part of its incremental capacity to DRAM rather than NAND, which will extend the NAND pricing cycle. UBS believes Micron's profitability is a structural reset, with cumulative free cash flow expected to exceed $450 billion by 2028.