Memory giant Micron had a bruising week: shares plunged 4.8% on Thursday after a Financial Times report that OpenAI's annualized recurring revenue was $20 billion lower than previously signaled, rattling the AI trade, then slipped another 0.6% Friday to close at $1,029. Even as AI stocks recovered Friday, Micron stayed pinned in the $1,000–$1,100 range where it has traded since mid-September. The stock is up about 260% this year, yet even blowout earnings can't lift it — Wall Street's skepticism about the memory cycle runs deep.
The circuit-breaker could be cold hard cash. Micron's 10-K filing discloses that the board approved raising the maximum share repurchase authorization to $35.16 billion, effective December 9, 2026. The prior $10 billion plan had only about $2.2 billion left unused. The filing also revealed $12.75 billion in customer deposits from new strategic agreements and capex guidance of about $25 billion for just the first half of fiscal 2027 — aggressive fab expansion alongside massive buybacks.
The date is no accident. Micron's buyback authorization is restricted under its 2024 CHIPS Act direct funding agreements, and December 9 marks the second anniversary of those agreements' signing, when the restrictions lift. "Over time, we expect to return 100% of our excess cash to shareholders," CFO Mark Murphy said on the earnings call, adding the returns would come mainly through buybacks and that the company expects to seek a bigger authorization soon.
UBS analyst Timothy Arcuri ran the numbers: Micron could start by buying back about $20 billion a quarter, rising to around $50 billion quarterly toward the end of fiscal 2027 (September next year) — up to $200 billion a year, similar in scale to Nvidia's recently announced record buyback. "Said differently, this now lays the path for Micron to buy back ~30% of the company over the next two years and potentially about half through 2029," Arcuri wrote, keeping a Buy rating and $1,625 target. Motley Fool's back-of-the-envelope version: at $1,065 a share, $62.3 billion would retire about 58 million shares in a year — roughly 5% of shares outstanding.
The bulls go further. D.A. Davidson's Gil Luria raised his target to $3,000 from $2,100 this week — nearly triple the current price — by ascribing a 19-times multiple to his 2027 earnings forecast, versus a forward PE of just 6.1 times (FactSet). Industry fundamentals back the optimism: Samsung estimates third-quarter operating profit surged nearly ninefold to 107.4 trillion won ($80.18 billion), driven almost certainly by memory chips, and memory production is only expected to meaningfully increase from 2028. Barron's has previously argued Micron could double amid the continued memory shortage — and major buybacks are the next catalyst.