Key Takeaways
- Mizuho’s Jordan Klein identifies recurring pullback patterns in memory stocks as opportunities for strategic entry points
- Micron Technology has retreated approximately 17% from recent post-earnings peaks, consistent with historical correction ranges of 14–21%
- Klein highlights Samsung, SK Hynix, SanDisk, ASML, Applied Materials, and Lam Research as preferred positions
- Morgan Stanley’s Joseph Moore characterizes memory as “the primary constraint on AI demand,” suggesting current valuations appear excessive
- Both firms anticipate substantially higher valuations in coming months, powered by AI infrastructure requirements
Recent declines in memory semiconductor stocks appear to follow a predictable cyclical pattern rather than signal a fundamental shift, according to analysis from two prominent Wall Street research teams.
Mizuho technology analyst Jordan Klein published a research note Thursday acknowledging that “memory long trade is starting to wobble big time” following robust performance throughout 2025 and into early 2026.
Klein’s assessment, however, frames these movements as routine fluctuations that appear regularly within ongoing uptrends.
“Actually you make money buying these dips,” Klein stated, dismissing concerns about potential market peaks.
[[LINK_START_1]]Micron Technology[[LINK_END_1]] has declined roughly 17% from its earnings-driven highs. Klein notes this correction aligns with six previous drawdowns ranging from 14–21% observed since the middle of 2025.
Throughout these fluctuations, the stock has delivered gains exceeding 200% during the same timeframe.
Klein attributes the current pressure to momentum-driven selling that exaggerates underlying fundamentals. He views the presence of widespread doubt as a positive contrarian indicator.
“What is worse is when everyone is all on the same side,” he noted.
Equipment Manufacturers Present Compelling Risk-Reward Profile
Klein ranks Samsung Electronics as his preferred individual selection within the memory chip segment. He maintains positive outlooks for SK Hynix and SanDisk as well.
Equipment suppliers, however, represent his highest-conviction category. Klein designates ASML as his premier choice among equipment makers, with Applied Materials and Lam Research rounding out his favored names.
These manufacturers stand to capture substantial value from expanding DRAM production capacity investments.
Klein expressed being “very confident that in 3–6 months they are all higher.”
Morgan Stanley Positions Memory as Critical AI Infrastructure Constraint
Morgan Stanley analyst Joseph Moore delivered parallel conclusions Wednesday, characterizing the selloff as “a healthy pricing in of durability concerns” while challenging narratives of weakening fundamentals.
Moore emphasized to clients that memory supply has become “increasingly THE primary constraint on AI demand.” This perspective elevates memory from a passive beneficiary of AI investment to an active limiting factor determining deployment pace.
Addressing Google’s “TurboQuant” memory efficiency initiative specifically, Moore reported that industry consultations revealed it represents “an evolutionary development, with basically no surprises for memory.”
Moore underscored the significant cash generation capabilities at Micron and SanDisk. He projects annual free cash flow at present earnings levels could represent 15–25% of their respective market capitalizations.
“While it won’t last forever, it is going to last for long enough to see the stocks move materially higher,” Moore concluded.
