Mizuho states that Micron and SanDisk are oversold, reaffirming the "Outperform the Market" rating.

MaticHoleFiller · 2026-04-04T08:45:48+00:00

Mizuho Securities is countering recent sell-offs of Micron Technology and SanDisk, suggesting that investor concerns over a potential "storage cycle peak" may be exaggerated. In a report to clients, analyst Vijay Rakesh stated that the weakness in these two stocks might reflect market sentiment rather than fundamentals, and pointed out that structural demand drivers related to artificial intelligence could continue to strengthen rather than diminish.Rakesh highlighted the latest advances in AI efficiency, including TurboQuant, which will be explored for the first time in 2025—now showing more results indicating improved reasoning performance—and Google's newly released algorithm. He believes these kinds of advances could reinforce a familiar pattern: higher efficiency driving greater usage. He referenced past cycles—virtualization ultimately increasing server demand.

MaticHoleFiller

2026-04-04 08:45:48

Mizuho Securities is pushing back against the recent selloff in Micron Technology and SanDisk, saying investors’ concerns about a potential “memory cycle peak” may be overstated. In a report to clients, analyst Vijay Rakesh said the weakness in these two stocks may reflect market sentiment rather than fundamentals, and noted that structural demand drivers related to artificial intelligence could continue to strengthen rather than fade.

Rakesh emphasized the latest progress in AI efficiency, including TurboQuant—first explored in 2025—now with more results showing improved inference performance, as well as a newly released algorithm from Google (GOOG -0.53% 96). He believes these advances may reinforce a familiar pattern: higher efficiency drives greater usage. He cited past cycles—virtualization ultimately increased server demand, and around the time DeepSeek launched in 2025, despite initial concerns about slower growth, AI growth instead accelerated.

Looking ahead, Rakesh pointed to several technological changes that could further support storage demand, including a transition from copper cabling to optical networking with significantly higher bandwidth—he believes this could increase, rather than reduce, capital expenditures for AI servers. He also said KV cache compression technology is expected to support larger-scale language models, faster inference speeds, and better Token economics, which could drive incremental spending across the entire ecosystem. Mizuho maintains a “outperform the broader market” rating on Micron and SanDisk, with target prices of $530 and $710, respectively, and said the current pullback could be a buying opportunity rather than a signal of a structural peak.

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