Micron Stock Rises After Analyst Reiterates Target, Sees 60% Gain Micron Technology
MU
+3.76%
stock was rising after a KeyBanc analyst reiterated his price target and rating, citing continued demand for memory.

Shares of Micron, up 466% over the past 12 months, have been riding a surge of demand for memory chips for use in artificial-intelligence servers.KeyBanc analyst John Vinh sees more gains ahead. He reiterated his Overweight rating and $600 price target on Micron stock, suggesting a 64% gain from Fridays close of $366.24.

Vinh expects prices for DRAM and NAND memory to increase by between 30% and 50% in the second quarter. Thats good news for Micron, although memory-chip makers could be testing the limits of what device makers can bear.

There is some concern that further price increases could more negatively impact demand in certain markets such as PC and smartphones, Vinh wrote.

The memory-chip industry is notoriously cyclical, with past booms followed by busts due to increased supply hitting waning demand. However, the KeyBanc analyst expects Microns valuation to be supported by the implementation of long-term supply agreements.

We see the structure of these LTAs [long-term agreements] as extremely favorable for memory producers as it addresses the shortcomings of past LTAs, which were easily broken, and likely mitigates downcycle risk, Vinh wrote.

Micron stock was up 3.3% at $378.26 in early trading Monday, while the SP 500
SPX
+0.27%
was up 0.2%, and the Dow Jones Industrial Average
DJIA
+0.20%
had gained 0.1%.