One of the hottest stocks of 2026 continues to give up some of its mind-blowing gains.
Micron stock (MU) has sank 22% since making new highs following its strong June 24 earnings report and outlook. Oddly enough, the stock is now below where it traded before its stellar earnings report.
“When strong (momentum) stocks can’t rally any further on good news, then you must take notice if long these names since the price momentum factor has become a very crowded/consensus trade,” 22v Research strategist Jeff Jacobson warned in a new note.
Jacobson added, “There has been a lot of speculation as to why these names have come undone as of late. Whether it was the Meta news last week, where they signaled that their data center builds may not extend beyond current plans, or the Apple news that suggested they may be looking to buy banned Chinese memory chips to offset rising costs, the stocks in this group all came under heavy selling pressure.”
The stock is still up a sizzling 250% year to date — with good reason.
The artificial intelligence capital expenditures boom sweeping the US has funneled down to Sandisk (SNDK), Micron, and many others in the memory chip space. As hyperscalers such as Amazon (AMZN) build AI data centers, demand for memory chips has surged. These chips store and move data for AI models, which require large volumes of information to perform at high levels.
Memory has become one of the tightest parts of the AI supply chain, allowing companies to hike prices to boost their profits.
Micron’s stock shot beyond the $1 trillion market cap milestone for the first time on May 26.
Analysts at Citi wrote in a note on Monday that the post-earnings weakness in Micron is a buying opportunity. They placed the stock on their 90-day upside catalyst watch list.
“We expect DRAM memory prices to continue to see upside,” Citi analyst Atif Malik said.
