Micron Is Up 266% This Year and Trades at 13x Earnings. Is That Cheap, or the Classic Memory-Cycle Trap?
- Micron reports fiscal Q4 2026 (quarter ending around late August) results on September 30, 2026.
- Its guidance: revenue of $50.0 billion ± $1 billion, gross margin of about 86%, and non-GAAP EPS of $31.00 ± $1.00. Consensus is about $50.45 billion and $31.16.
- Fiscal Q3 (ended May 28): revenue $41.46 billion, up from $9.30 billion a year earlier; non-GAAP EPS $25.11; gross margin 84.9%.
- As of Sept. 22 the stock was about $1,081, up about 266% year to date, with a market value near $1.2 trillion and a forward P/E of about 12.8.
- HBM supply for 2026 is reported fully booked, and HBM4 is shipping in high volume. DRAM spot prices are up about 52% since January.
From $9 billion to $50 billion a quarter
One year ago, Micron's quarterly revenue was $9.30 billion. For the quarter it reports on Wednesday, September 30, it has guided to $50 billion.
That's one of the fastest revenue surges ever for a company of its size. The reason is AI. Every AI chip needs fast memory next to it, and memory makers can't build it fast enough.
The stock has followed. Micron traded around $1,081 on September 22, up about 266% this year, and is worth roughly $1.2 trillion.
The numbers to watch on September 30
| Measure | Micron's guidance | Consensus | Last quarter |
|---|---|---|---|
| Revenue | $50.0B ± $1B | ~$50.45B | $41.46B |
| Gross margin (non-GAAP) | ~86% | — | 84.9% |
| EPS (non-GAAP) | $31.00 ± $1.00 | ~$31.16 | $25.11 |
With the stock up this much, beating these numbers probably isn't enough. What matters most:
- Next quarter's guidance. Analysts are watching whether fiscal Q1 2027 revenue guidance clears roughly $55 billion.
- HBM language. Is 2027 HBM supply already sold out? At what prices?
- Capital spending. How much Micron plans to spend on new factories. More spending means more supply later.
- Gross margin. At 86%, margins are extraordinary for a manufacturer. Any sign of a peak will move the stock.
What HBM is, in one paragraph
High-bandwidth memory is regular DRAM stacked in layers and placed right beside an AI processor, like Nvidia's GPUs, so data flows extremely fast. It's hard to make, supply is limited, and customers pay premium prices. Micron says HBM4 is shipping in high volume, including for Nvidia's Vera Rubin platform, and next-generation HBM4E is due in 2027.
The low-P/E trap in cyclical stocks
Micron trades at about 12.8 times expected earnings. The S&P 500 trades near 19 times. So Micron looks cheap. Is it?
Here's the lesson every investor in cyclical stocks eventually learns: cyclical stocks often look cheapest at the top.
Memory has boomed and busted for decades:
- Demand outruns supply, and prices soar.
- Profits explode, so the P/E looks low.
- Everyone builds new factories.
- Supply catches up, prices fall, and profits collapse.
- The P/E suddenly looks high, often near the bottom.
That's why experienced investors watch memory prices, inventory and industry capital spending, not the P/E. We explain the pattern in How the Semiconductor Cycle Works and the P/E's limits in P/E Ratio Explained.
Is this time different?
The bull case says yes:
- AI demand is a data-centre supercycle, not a consumer cycle tied to phones and PCs.
- HBM takes up much more factory capacity per bit, which limits supply growth.
- Customers are signing long-term contracts.
Bank of America's bull case, for example, sees Micron's EPS above $230 by fiscal 2030 and calls peak-cycle fears "overblown."
The bear case: every memory boom has felt different. Samsung and SK Hynix are expanding capacity too, and AI spending depends on a handful of very large customers.
How to approach it
- If you own Micron, it may now be a much larger share of your portfolio than you intended. Consider whether that weight fits your risk tolerance.
- If you want in, expect big moves on earnings day. Options markets typically price a double-digit swing around memory earnings.
- If you own index funds, you already hold Micron. At about $1.2 trillion, it's now one of the largest US companies.
The honest uncertainty
No one knows when the memory cycle turns. Micron could beat and guide higher for several more quarters. But when profits rise from $9 billion to $50 billion of quarterly revenue in a year, the question is how long, not whether, it lasts. Watch the guidance and the capex, not just the headline beat.
Frequently asked questions
When does Micron report earnings in 2026?
Micron reports fiscal fourth-quarter 2026 results on September 30, 2026, after the market close. It guided to revenue of $50.0 billion plus or minus $1 billion and non-GAAP EPS of $31.00 plus or minus $1.00.
Why is Micron stock up so much in 2026?
AI data centres need huge amounts of memory, especially high-bandwidth memory (HBM) that sits next to AI processors. Demand has far outstripped supply, pushing memory prices and Micron's margins to records. Quarterly revenue rose from $9.3 billion a year ago to $41.5 billion last quarter.
Is Micron stock cheap at 13 times earnings?
It depends on whether today's earnings last. Memory is a cyclical industry: when prices are high, companies build more capacity, and prices eventually fall. Cyclical stocks often look cheapest on P/E at the peak of earnings. Investors should weigh how long AI-driven demand can outrun new supply.
What is HBM?
High-bandwidth memory is stacked DRAM placed right next to an AI chip, such as Nvidia's GPUs, so data moves very fast. It's harder to make than regular memory and sells at much higher prices, which is why it has driven Micron's profit surge.
Primary sources
Data & disclaimer: This article is for educational purposes only and is not financial or investment advice. Figures reflect data available as of Sep 26, 2026, and conditions change — always confirm current pricing, rates and rules with the provider before you act. Written by Elizabeta Dimoska. See our editorial standards and disclosure.
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