AI MEMORY · MU

Micron Technology stock research & valuation

Model Preview / Research in Progress · Memory manufacturer · HBM / DRAM / NAND

Overview

DILIKOGLU RESEARCH VIEW · MODEL 2026-10-03

Investment summary

Model Preview / Research in Progress · Model-based fair values; no formal recommendation or published price target.

Micron’s opportunity is to convert AI-memory demand into durable cash returns. The model separates estimated HBM from other DRAM and NAND, while normalizing pricing and margins and deducting capital reinvestment. This reviewed scenario baseline discloses the estimates and sensitivities supporting valuation; it is not an investment recommendation.

Current model Base fair value / share: $1355.27
Current model probability-weighted fair value / share: $1223.41
Key catalyst: FY27 execution, HBM qualification and capacity ramps
Principal risk: Memory pricing normalizes faster than modeled.

USD per share. Valuations are DR model estimates, separate from dated report targets. Scenario probabilities and supporting assumptions appear below.

Valuation & scenarios →Revision history →Supporting sources →

Latest available price: Unavailable
Base return vs latest price: —

Evidence review →

Primary operating KPI: Bit volume × ASP; normalized cash returns
Last recorded model update: 2026-10-03

Explore the analytical model → · Portfolio Analytics →

Investment Thesis

Contract durability versus pricing normalization and reinvestment

HBM growth can improve product mix, but remains part of total DRAM.
Customer agreements provide visibility without eliminating price, delivery and concentration risk.
Capital spending and working capital determine how much operating profit becomes equity value.

Variant perception

Near-term scarcity margins are not a permanent terminal margin. Underwrite bit volume, pricing and reinvestment separately.

What could make us wrong

ASP erosion, HBM delays or reinvestment above cash returns

Key catalysts

FY27 execution, HBM qualification and capacity ramps

Scenario conclusions are Dilikoglu Research estimates. Company evidence, management guidance and analyst assumptions are distinguished in the analytical model.

Scenario Valuation

Scenario	Probability	Fair value / share	Return vs price
Failure	10%	$106.16	—
Bear	25%	$483.53	—
Base	45%	$1355.27	—
Bull	20%	$2410.22	—

Probability-weighted fair value: $1223.41

FY27–FY36 FCFF DCF plus normalized earnings sensitivity

Monte Carlo median: $1177.34. Distributional cross-check, separate from the scenario valuation.

Ten-year FCFF DCF; correlated operating, pricing, cost, capex, working-capital, discount-rate, share and strategic-claim shocks. Reserve shortfalls incur issuance friction once. Judgment-based, not calibrated probabilities.

Key Base-case drivers · model 2026-10-03

These selected forecast inputs are Dilikoglu Research estimates. Units are shown explicitly; debt funding is not a lender commitment. Reported anchors and management guidance are distinguished in the full model source register.

Input	Base estimate	Units
WACC	10.00	%
Terminal growth	3.00	%
Terminal ROIC	16.00	%

Scenario contributions and downside sensitivity

Derived from the current model above. These are scenario-weighted estimates, not calibrated probabilities of future returns.

Scenario	Weight	Fair value	Contribution to PW
Failure	10%	$106.16	$10.62
Bear	25%	$483.53	$120.88
Base	45%	$1355.27	$609.87
Bull	20%	$2410.22	$482.04

Bull contributes 39.4% of PW.

Excluding Bull and renormalizing the other weights to 100%: $926.71. Formula: sum of non-Bull weighted values ÷ (1 − Bull weight). This is a conditional diagnostic, not a replacement target.

Scenario mechanisms and weight limitations

The weights are analyst priors. The mechanisms below explain what each case represents; they do not statistically establish the numerical probability. Similar weights across companies should not be interpreted as equal default risk.

Failure · 10%: Severe memory-cycle normalization and reinvestment pressure compress cash returns; this is not a stated insolvency probability.

Bear · 25%: Pricing and utilization normalize faster while manufacturing investment remains substantial.

Base · 45%: Guided near-term demand and HBM expansion support cash generation, followed by modeled cycle normalization.

Bull · 20%: Demand absorbs new qualified supply and attractive mix/pricing persist longer; high returns must survive the capacity response.

Weight changes require an evidence-based review of contract coverage, delivery, financing and balance-sheet capacity. No weights have been adjusted to match the market price.

Model

Model scope: Scenario-based independent research. Interactive controls are diagnostics; published valuation outputs reflect the published research baseline.

Open full analytical model →

Explore the interactive model here

Research

Model Preview / Research in Progress. No initiation report or formal recommendation has been published.

Revision history

This register begins with the documented baseline below. It is not a complete historical track record. Snapshot values remain fixed; the investment summary reflects the current published model.

2026-10-03 · Model refinement

FY26 close and FY27 guidance incorporated

What changed: Replaced estimated Q4 opening with reported balances; updated quarterly forecast, capital program, customer-claim and funding treatment.

Why: September 30 results and explicit source reconciliation.

Valuation impact: Base $1,355.27; PW $1,223.41. Historical portfolio reference retained.

Recorded Base fair value: $1355.27
Recorded PW fair value: $1223.41

Model date 2026-10-03 · USD per share · DR estimates

Change from recorded 2026-09-13 entry: Base +299.57; PW +239.87 USD per share. These are differences between recorded endpoints, not isolated causal contributions.

The grouped model walk below reconstructs this revision. Its intermediate values depend on update order and are not independently approved forecasts.

Reconstructed valuation walk · reviewed 2026-10-14

This ordered calculation replaces groups of prior assumptions with the current inputs. It explains model arithmetic, not the independent economic cause of a valuation change. Intermediate combinations are diagnostics, not published forecasts.

Prior Base $1055.71 / PW $983.55. Running the prior inputs through the current engine changes Base by +0.00 and PW by +0.00 USD per share.

Update group, in order	Base change	PW change	Base after update	PW after update
Reported opening position and common model assumptions	+251.29	+243.18	1306.99	1226.73
FY27 volume, pricing, capacity and quarterly plans	-51.13	-65.68	1255.86	1161.05
Post-FY27 growth, pricing normalization and costs	+102.82	+65.33	1358.69	1226.38
Operating cash costs, reinvestment, working capital and funding	-3.42	-2.97	1355.27	1223.41
Discount rate, terminal returns and scenario weights	+0.00	+0.00	1355.27	1223.41

All amounts are USD per share. The opening-position group includes shared analyst assumptions as well as updated reported figures; it should not be read as the effect of reported results alone. The revised endpoint is Base $1355.27 / PW $1223.41.

Interaction check: reverse update order

The same groups applied in reverse reach the same final values, but their individual contributions differ because operating and financing assumptions interact.

Update group, in reverse order	Base change	PW change
Discount rate, terminal returns and scenario weights	+0.00	+0.00
Operating cash costs, reinvestment, working capital and funding	-34.69	-28.95
Post-FY27 growth, pricing normalization and costs	+101.40	+64.98
FY27 volume, pricing, capacity and quarterly plans	-56.99	-69.78
Reported opening position and common model assumptions	+289.85	+273.62

Model provenance

Model SHA-256: 188872ef27ddaf90d1f8f634127c7b42223332e9fd67c72060126d6914019c3c

This fingerprint identifies the model file used to record these values. Fingerprint verified 2026-10-14 against the matching stored model; this does not backdate verification.

View current model · Review source disclosures

2026-09-13 · Baseline recorded

Dated model baseline

What changed: Recorded scenario valuation baseline.

Why: Historical starting point; the investment summary shows the current model.

Valuation impact: Dilikoglu Research estimates; no recommendation assigned.

Recorded Base fair value: $1055.71
Recorded PW fair value: $983.55

Model date 2026-09-13 · USD per share · DR estimates

Model provenance

Model SHA-256: 25605eda8a37a005e062e05e8c8ce439be0e45422c927a506b59ce53ba8dbd80

This fingerprint identifies the model file used to record these values.

View current model · Review source disclosures

Sources

Key Evidence

Filings and contractual documents take priority, followed by company materials and then third-party context. Forecasts are DR estimates.

Evidence review 2026-10-03 ·

FY26 Q3 results and Q4 guidance · Primary company disclosure
FY26 Q3 Form 10-Q, technology revenue and balance sheet · Primary company disclosure
FY26 Q3 prepared remarks, HBM and customer agreements · Primary company disclosure

Open Evidence Items

These material limitations remain relevant to valuation; a published report does not resolve them.

HBM amount and product cost allocation are estimated.

Status: Open estimate / disclosure limitation

Year-end balance-sheet disaggregations await full annual-report notes.

Status: Open estimate / disclosure limitation

Contract price bands and quarterly shipments are not publicly specified.

Status: Open estimate / disclosure limitation

Terminal margins, capital timing and capacity indexes remain estimates.

Status: Open estimate / disclosure limitation

Full Evidence Register

The original model ledger below records its verification status at the model date. The dated review above identifies subsequent checks and remaining limitations.

Q4 GAAP results and closing cash, investments, debt, inventory and net PP&E

Reported · USD billions, fiscal quarter ended September 3. Restricted cash $0.027bn excluded. Reported amounts replace the old Q4 estimate; no additional Q4 FCFF is added.

Q4 technology revenue and annualized operating anchor

Management guidance-commentary · DRAM $39.8bn / NAND $14.1bn are rounded disclosed results. Annualization uses 52/14 weeks, not four times the 14-week quarter. Other revenue is a residual estimate.

Q1 revenue / GAAP margin / GAAP opex / tax / shares

Management guidance-commentary · Base Q1 $61.5bn, 85.95%, $2.31bn, 15.5%, 1.15bn. Use GAAP costs including SBC; no SBC cash add-back.

FY27 quarterly estimates and operating expenses

Dilikoglu Research estimate · Base revenue grows 5/4/3% sequentially after Q1. Margin 85.95/86.5/87/87.5%. FY27 GAAP opex $10.164bn = FY26 non-GAAP $6.841bn + $2.5bn management increase + $0.823bn recurring GAAP adjustment estimate; excludes $0.5bn patent charge from recurring base.

Capital investment

Dilikoglu Research estimate · Base net capex $54bn floor: Q1 $11.5bn and H1 $25bn follow guidance; $29bn H2 is DR estimate. Gross capex adds estimated $1.5bn incentives. Later floors and commissioning are estimates, not commitments.

Closing working capital and tax allocation

Dilikoglu Research estimate · Use Q4 consolidated balances; nontrade receivables held at Q3 levels, payable components scaled pro rata, tax liability inferred from Q3 noncustomer liability mix. Customer price accruals included in operating NWC. Capital payables settle in cash capex, not as a second debt deduction. Explicit stresses bound these estimates.

Deposits, debt and strategic holdings

Dilikoglu Research estimate · Cash investments $73.453bn less $5.179bn debt and $12.747bn received deposits. Tax claims net of receivables are separately reserved. Remaining strategic cash reserve $3bn has 50% recovery, plus $0.523bn estimated value for funded investments; no repeat subtraction of FY26 investment cash already paid.

HBM allocation, manufacturing and product costs

Dilikoglu Research estimate · HBM Q4 $8.4bn versus prior estimated Q3 $6bn; 40% growth is consistent with commentary that HBM outgrew total revenue, but amount is undisclosed. Sensitivity $6–11bn. HBM is deducted from DRAM. Shared supply and packaging constraints prevent additive double counting. Cash-cost calibration matches the explicit quarterly margin plan, never stock price.

Historical gross margins

Reported · FY23–25 from historical filings; FY26 from latest release. Cycle context, not probability calibration.

Asset depreciation and capital timing

Dilikoglu Research estimate · Reported opening PP&E $63.310bn and Q4 D&A $2.641bn. Estimated CIP $14.5bn, equipment not in service $4.5bn, land $0.420bn. Equipment/building lives 7/20 years, lags 1/2 years, construction mix 60%; net cash capex proxy for additions. All asset cohorts reconcile.

Valuation, dilution and simulation

Dilikoglu Research estimate · 10/25/45/20 priors; WACC 13/11.5/10/9%, growth 2/2.5/3/3.5%. Ten-year FCFF DCF plus separate normalized EV/NOPAT sensitivity. 29-day stub from FY27 opening to October 2. 20,000 correlated seeded draws; forecast revenue, costs, margins, capital, working capital and funding friction rerun per draw. No market calibration.

Pricing normalization and contract limits

Dilikoglu Research estimate · Base/Bull begin normalization FY29, phasing at 50/75/100% of full annual declines. This reflects tighter supply commentary through 2028; no undisclosed SCA floors are fabricated. Failure/Bear model an earlier reversal as explicit misses of guidance.

Company Filings

FY26 Q3 results and Q4 guidance · Primary company disclosure · 2026-06-24
Historical baseline and context; forecasts separately classified as DR estimates.
FY26 Q3 Form 10-Q, technology revenue and balance sheet · Primary company disclosure · 2026-06-25
Historical baseline and context; forecasts separately classified as DR estimates.

Company Materials

FY26 Q3 prepared remarks, HBM and customer agreements · Primary company disclosure · 2026-06-24
Historical baseline and context; forecasts separately classified as DR estimates.

Financing / Counterparty Sources

See the company model’s evidence register for applicable disclosures.

Regulatory / Infrastructure Sources

See the company model’s evidence register for applicable disclosures.

Industry / Market Data

See the company model’s evidence register for applicable disclosures.

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