Jo Bhakdi
Investor, Tesla & AI Stocks
HBM production and pricing growth make Micron's roughly 6x forward multiple catastrophically wrong to imply an earnings collapse by 2029. HBM production is set to grow 700%, while Bloomberg Intelligence projects prices rising from $13 to $35 per GB by 2030. Micron's HBM business will then make up 70% of revenue, with margins tripling. Getting the memory cycle's end wrong by just two years can badly distort stock forecasts; the market is off by ten. x.comÂ
Micron's selloff on reports that OpenAI missed revenue by $20B shows the market being dumb, creating an alpha opportunity. The $70B figure was an attempt to estimate OpenAI's gross revenue for comparison with Anthropic, which reports gross, while the leaked $50B is net of revenue shares such as Microsoft's reported 20%. OpenAI performed pretty much as expected. x.comÂ
Micron stands to gain as HBM demand outstrips supply even while shipments rise. Bloomberg Intelligence projects HBM bit shipments rising almost fourfold from about 5,000M GB in 2026 to 18,000M GB by 2030, while average price per GB more than doubles from around $16 to $35. This may be the most bullish memory chart of the year: more supply usually means lower prices. Micron is one of only three scaled HBM makers, with 26 strategic customer agreements locking in demand through 2030. Mega bullish. … Show more
Hynix's sold-out memory supply supports expectations for big numbers from Micron, still trading at 5x forward earnings. Hynix says its HBM and DRAM chips are sold out until 2029 and a chip shortage is likely to continue into 2030. Big numbers and capital return are expected after Micron reports in December. x.comÂ
Micron's roughly $1.37 trillion valuation already prices a durable rise in through-cycle earnings that memory's history has never shown. A reverse DCF at 9% WACC and 2% growth implies about $95 billion of steady cash flow, versus a record $9.2 billion and a ten-year average near $1.9 billion. At a 30% FCFF margin that needs about $317 billion of revenue, over 8x fiscal 2025 sales. The HBM bull case is real, but fiscal 2023's swing to a -37% operating margin shows how fast pricing reverses. x.comÂ
Slow capacity growth and HBM's heavy wafer use make a near-term collapse in memory-stock profits look too gloomy. Goldman Sachs thinks the memory shortage could last until 2030: makers are adding capacity at 7-8% a year through 2030, versus 12% in the last boom, and each HBM wafer displaces capacity for about three ordinary-memory wafers. SK hynix trades at 4x forward earnings and Micron at 6x, multiples that imply the market expects profits to collapse soon. x.comÂ
Micron's HBM and server-memory scarcity is backed by customer commitments beyond its earlier sold-out 2026 capacity. Per management and sell-side reports, more than about 75% of fiscal 2027 shipments are allocated or contracted, supply may not rebalance through 2028, and 2027 HBM prices have risen significantly. Strategic agreements extend through 2030; a later supply glut or faster Chinese competition could erode margins. x.comÂ
Micron faces a severe crash risk from CXMT's current threat and apparent investor complacency after a euphoric high. If the Wall St Cheat Sheet fits, most of Micron's gains across 40 years, amassed in just one year, could be erased soon. Earlier, Elon Musk said Micron had been reasonable on future memory prices; memory stocks were not yet to be faded. x.com x.comÂ
Micron's sold-out high-bandwidth memory through 2027+ and contracts already being signed for 2029-2030+ extend its earnings runway. At 5x forward earnings, it is cheaper than a year ago; its private Anthropic stake is about to be instantly rerated at Anthropic's IPO, and a new share buyback is expected to be announced Dec. 9. Micron could certainly gain 30% in three months. x.com x.comÂ
Micron and SK hynix pricing in a memory shortage past 2030 extends the memory-cycle case beyond the Street's 2028 expectation. SK hynix's record quarter adds evidence: per Wall St Engine, revenue rose 328% to $78.9B, operating profit rose 632% to $62.8B, and operating margin hit 80%. Agentic and physical AI could add demand as they roll out. x.com x.comÂ
Micron's risk-reward for longs is unappealing because Chinese memory makers could crush the non-HBM profits that still make up most of its earnings. State-backed firms such as CXMT trail in HBM but can aggressively expand low-end capacity if Beijing wants, as China has done elsewhere. HBM growth is unlikely to offset that: memory nears 50% of rack bill of materials, and Micron locking in half its revenue for five years at capped prices suggests pricing has peaked, leaving growth to volume. x.com … Show more
Micron's bet on 3D DRAM over rivals' 4F2 could give it an edge as AI memory demand rises. Micron expects shortages for at least two more years: HBM per GPU rose 3.6x from H100 to B300, inference memory per server doubled in three years, and agent context grows about 30x annually. It plans further 6F2 nodes, 1-delta DRAM in 2H27 and 400-plus-layer G11 NAND in 2027; processor-stacked vHBM is targeted around 2028. If Micron is right, rivals are spending on the wrong path. Overweight Micron. x.comÂ
