Morgan Stanley Boosts Micron and Western Digital Shares Amid AI Boom

New York, NY — Morgan Stanley analysts have upgraded Micron Technology‘s stock, suggesting it could be in the early stages of another rally. The bank raised its recommendation for the semiconductor manufacturer to overweight from equal weight.

Analyst Joseph Moore increased the price target for Micron from $160 to $220, indicating a potential upside of 17%. Micron’s stock has surged 123% since the beginning of the year, as strong earnings estimates and a promising long-term outlook for artificial intelligence (AI) contribute to investor enthusiasm.

Moore noted that despite the considerable growth in Micron’s valuation, there remains substantial upside potential. He pointed out, “Micron is pushing the envelope on valuation as the group rallies,” emphasizing continuing robust demand for the company’s DRAM and NAND storage components.

Supply-side concerns are affecting buyers as inventories thin out through 2026, Moore stated, which may enhance Micron’s earnings power. “We believe we are looking at multiple quarters of double-digit price increases,” he added.

In another positive development, Morgan Stanley significantly upgraded its price targets and forecasts for Western Digital, another major player in the data storage sector, indicating that demand driven by cloud infrastructure and AI is expected to remain robust. Western Digital’s share price is projected to reach $171 from a previous target of $99, while Seagate Technology’s target went from $168 to $265.

Both companies have more than doubled in stock value this year, making them among the best performers in the S&P 500. Western Digital currently stands as a top pick following favorable discussions with management. The bank believes that Western Digital and Seagate Technology will continue to benefit from a sustained increase in demand driven by AI spending and data storage needs.

“We are still in the middle of an upturn for data storage demand,” Morgan Stanley analysts noted, reinforcing the optimistic outlook for both companies. Western Digital shares were trading around $116, tracking towards an all-time high, while Seagate’s shares were near a record close around $227.

As investors keenly await further developments in the semiconductor and data storage sectors, both Micron and Western Digital appear well-positioned to capitalize on the ongoing AI boom.