Prosper Junior Bakiny, The Motley Fool Thu, November 12, 2026 at 11:20 AM EST 5 min read MU -2.37% NVDA -4.70% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Micron Technology (NASDAQ: MU) seemed unstoppable in the early months of the year. However, the company's shares have dropped more than 40% after reaching an all-time high in late June. Further, recent developments have made the future of the artificial intelligence (AI) industry a little more uncertain. Micron Technology is still up by 154% year to date, but how will the stock move over the next year? Let's try to determine what its share price could be by the end of 2027.
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It's hard to argue with results, and Micron's financial performance this year has been nothing short of excellent. During its fiscal year 2026, which ended Sept. 3, Micron's revenue of $133.19 billion increased by 256% year over year. The company's non-GAAP gross profit was $108 billion, up almost 607% compared to the year-ago period. And its non-GAAP gross margin nearly doubled from 40.9% to 81.1%. Micron's non-GAAP earnings per share were $75.52, up 811% year over year.
Despite Micron's excellent results, several reasons make many investors skeptical of the company's future. First, Micron is capitalizing on a shortage of memory chips, which are essential components amid the massive AI infrastructure expansion. This is granting the company and its peers in the memory chip industry significant pricing power. But there is uncertainty regarding how long this shortage will last.
Once revenue and earnings growth normalizes for Micron (it always does, eventually), the stock may experience downward pressure. Second, the results of the recent U.S. midterm elections were not great for AI companies. Democrats, some of whom ran on putting more guardrails around AI -- including data center expansion -- captured both chambers of Congress.
If hyperscalers are forced to slow their AI infrastructure build-out, it could lead to lower demand for Micron's products, especially in its core data center segment, which was responsible for much of the company's growth during its fiscal year 2026. During the fourth quarter of the year, Micron's data center revenue was $18 billion, accounting for roughly 33% of the company's total sales of $54.2 billion. Further, data center revenue grew 1041.5% year over year, whereas total revenue jumped 379%.
The core data center segment also had a gross margin of 90%, versus the companywide non-GAAP margin of 87%. If there is significantly lower demand for Micron's data center solutions due to increased regulatory oversight, it could lead to much lower revenue and earnings growth over the medium term.
How will stricter regulatory scrutiny on data center expansion plans affect spending in the industry next year? The impact might be fairly minimal. Data centers for which companies have obtained appropriate permits, are already under construction, and could be completed next year may be the least exposed to legal and regulatory risks. However, obtaining permits from here on out may become harder.
Even assuming Micron and other companies that help equip data centers don't see a meaningful blow to their financial results next year, things could be very different starting in 2028. That means investors should potentially brace for lower forward earnings multiples by the end of 2027, depending on how the year goes. There is significant uncertainty, of course.
It's also important to consider how long the memory shortage will last. According to some projections, it should persist at least until 2029, which could work in Micron's favor. With all that said, how much will the stock be worth by the end of 2027? Consider that Micron is trading at 4.2x forward earnings, as of writing. At these levels, the market has already factored in much of the risk and uncertainty mentioned above, as well as the inherent cyclicality of the semiconductor industry, at least in my view.
Analysts, on average, expect the company's EPS to rise to $176.5 during its current fiscal year 2027 (according to Yahoo! Finance), which ends around September of next year, and to $207.76 for its fiscal year 2028. Taking those at face value, and assuming Micron's forward price-to-earnings stays constant, its stock price could be $831.04 by the end of 2027, a roughly 15% increase from current levels, as of writing.
That's not bad, but remember there is significant uncertainty, particularly around any estimates after 2027. So, is Micron stock a buy? Even considering recent developments, I'd still invest in the stock, starting with a small position and potentially adding more shares as the regulatory impact of the recent election results on the AI industry becomes clearer.
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Prosper Junior Bakiny has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool has a disclosure policy.
Prediction: This Will Be Micron's Stock Price by the End of 2027 was originally published by The Motley Fool
