Nvidia CEO Jensen Huang recently forecasted that the company’s AI processors could generate $1 trillion in sales by 2027, highlighting a significant growth opportunity for the tech sector. While Nvidia (NVDA) is the obvious beneficiary, Micron Technology Inc. (MU) stands to gain substantially as a key supplier of memory chips essential for AI applications. Micron’s recent production of the HBM4 memory chip for Nvidia’s new Vera Rubin GPU positions it favorably amidst a critical memory shortage that is driving prices and demand skyward.

The memory shortage is projected to last until at least 2028, with prices for RAM expected to rise by 50% in early 2026. Micron’s impressive financial performance reflects this trend, with a staggering 686% increase in net income year-over-year for Q2 2026, and an annual earnings per share (EPS) projection of $51.49 for 2026. This growth is underscored by a low PEG ratio of 0.44, indicating that Micron may be undervalued relative to its future earnings potential.

For market professionals, Micron represents a compelling investment opportunity as it capitalizes on the ongoing memory shortage and its strategic partnership with Nvidia. As demand for AI-driven applications continues to surge, Micron’s expansion efforts, including a $100 billion semiconductor factory in New York, position it to emerge as a dominant player in the tech hardware landscape.

Source: fool.com