Zacks Rates Micron a Strong Buy Over Nvidia on 16.65x Valuation and HBM Demand

2 articles · Updated · Zacks Investment Research · Jun 12

Micron won Zacks’ preference over Nvidia because it trades at 16.65 times forward earnings versus Nvidia’s 22.97, giving investors cheaper exposure to the AI buildout.
HBM demand is the main driver: Micron said fiscal third-quarter 2026 revenue should reach $33.5 billion after $23.86 billion in the prior quarter, with supply tightness supporting pricing power and margins.
Micron also expects about 81% gross margin in fiscal Q3, helped by constrained HBM and NAND supply and by having much of its HBM capacity already sold through 2026.
Nvidia still posted stronger absolute growth—fiscal first-quarter 2027 revenue hit a record $81.6 billion and data-center sales reached $75.2 billion—but Zacks said that strength is more fully reflected in its share price.
China export curbs remain a risk to Nvidia’s future growth, while Zacks said Micron’s shift from cyclical memory maker to AI infrastructure supplier improves its long-term investment case.