11:28 AM EDT, 06/27/2024 (MT Newswires) -- Micron Technology ( MU ) is benefiting from long-term trends in data centers, cloud computing, and 5G markets, analysts at BofA Securities said in a note Wednesday.

Analysts, including Vivek Arya, said the company is ramping up production of high-bandwidth memory 3e, or HBM3e, aiming for significant sales growth in fiscal 2024 and fiscal 2025, with volumes already sold out and prices secured. This includes artificial intelligence and traditional server demand as well as increased dynamic random access memory needs from edge AI applications like PCs, tablets, and smartphones.

The analysts added that they now expect sales growth of 78% and 41% year-over-year for 2024 and 2025 respectively, with pre-financial earnings per share expected to grow 178% and 14%.

"The company benefits from several secular trends in the data center, cloud computing and 5G markets. We believe we are beginning to pass the trough of the memory cycle as memory pricing improves, and see room for possible share gains in high-bandwidth memory," the analysts said.

Micron confirmed that HBM3e sales will contribute "several hundred million dollars" in fiscal 2024, growing to "several billion" in fiscal 2025. The company expects its market share to increase between 25% and 30% by 2025. It projects healthy gross margin expansion throughout fiscal 2025, supported by transitions to advanced technology nodes and returning to normal cost reduction efforts, the analysts said.

BofA reiterated its buy rating and $170 price target on Micron Technology ( MU ). Shares of the company fell nearly 6% in recent trading activity.

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