So far, investors are well aware of big winners in Artificial Intelligence (AI): Stocks like stocks Nvidia And Palatir Which has already given huge returns to initial investors.

However, AI has a lot of winners, and some of them are more ignored than others. A stock that still looks underwelled even after doubles in April Micro -technology ,MU -0.98%,A major manufacturer of memory chips, which includes high-bandwidth chips used for AI applications.

Micron is also an integrated device manufacturer, meaning that it designs both and builds its own chips, separates it from companies such as Nvidia, BroadcomAnd Advanced micro equipmentIt exposes instability to the company due to cyclic nature semiconductor industryBut it turns the stock more in good times as it can perfectly catch the benefits of AI Boom.

Coming to the company’s fiscal third quarter earnings report, the stock was rally along with the rest of the technical field as the concerns have faded due to concerns and a recession as President Donald Trump announced the “liberation day” tariff and later stopped them. Micron did not disappoint.

let the Good Times roll

The speed continued in the third quarter as the revenue increased by 37% to $ 9.3 billion, and gross profit increased from $ 1.83 billion to $ 3.5 billion, as gross margin increased by 26.9% to 37.7%. This suggests that the company is benefiting from increased capacity as its more commercial shifts change the data center sector, most of which is AI, and high-bandwidth memory (HBM).

The management stated that HBM revenue increased by about 50% sequentially, and the revenue of the data center doubled to a quarterly record on a year-on-year basis. The company also recorded an all-time high in revenue for DRAM (Dynamic Random-access memory), including HBM revenue. And 55% of its revenue came from data center and networking sales, which was 30% a year ago.

At the bottom line, the performance of the micron also continued to improve with the expansion of the margin as the adjusted income (EPS) jumped from $ 0.30 to $ 1.68, and the operating margin increased from 10.6% to 23.3% a year ago. Again, that figure gradually improved, increased from 22% to 23.3%, a favorable signal.

The company easily defeated estimates on the lines up and down, and the stock initially jumped on the results after hours, but then pulled it back as the company revealed that prices were down to some of its chips.

However, guidance for the fiscal fourth quarter, its biggest year, as well as strong. The company hopes that a year ago, a revenue of $ 10.4 billion to $ 11 billion from 38%, and EPS of $ 1.18 to $ 2.35 to $ 2.65 was adjusted in the quarter a year ago.

Is Micron a purchase?

After earning reports and update guidance, Micron traded at P/E next 16, for a sufficient discount S&P 500 And its chip stock peers. Analysts also noticed that an forecast of adjusted EPS of $ 12 next year continues to earn on the ramp in fiscal 2026.

If those forecasts are correct, the stock definitely looks like a purchase. The concerns of the aforesaid pricing have led to a modest sales in stock on Thursday after the earning reports, but the company is well deployed to continue to benefit from the increase in AI.

Its biggest customer is now NVidia, and the relationship between the two companies is getting stronger. Micron was invited to present its portfolio of data centers memory and storage products at Nvidia’s GTC conference in March.

It is also the only manufacturer of advanced memory chips in the US, with it a strategically important company, and was awarded $ 6.2 billion for the manufacture of new plants in the US.

With factors that appear to be a permanent tailwind in AI, they should run the development of the company for the future. While Micron will experience another cyclical rotation at some point, it looks like an attractive purchase in the current assessment.