Memory
Remember when ‘the AI trade’ meant Nvidia and semiconductor stocks? In 2026, memory is just as critical as GPUs. It’s why analysts see a supercycle for memory chip stocks.
It's only the second full trading week of 2026 and the S&P 500 is inches away from 7,000. Over 64% of stocks are trading above their 200-day moving average. Less than half are in correction territory.
All that points to better market depth, which could mean more sustainable rallies. Also, a sign that investors are rotating beyond the same handful of tech names. The AI trade still has legs… but now it's got arms too.
Memory chip stocks are the new structural beneficiaries of AI workloads. Training larger AI models and running inference at scale requires massive amounts of high-bandwidth, low-latency memory. Firms like Micron Technology ($MU) are front and centre of that story.
$MU is up 263% YoY and the firm tripled net income last quarter. The firm supplies Dynamic Random Access Memory (DRAM) and High Bandwidth Memory (HBM) to pair with Nvidia ($NVDA) and AMD’s ($AMD) GPUs. DRAM and HBM are crucial components that let AI ‘think longer.’
Fun fact: Crucial is also the name of Micron’s consumer business, which the company announced it’s fully exiting in December in order to service demand from AI data centres. That’s another blow for PC-building hobbyists already struggling with skyrocketing RAM prices.
Sandisk ($SNDK) is another stock riding the memory wave. $SNDK has rallied 971% YoY as investors pooled into NAND flash memory maker. NAND flash provides high-capacity, fast storage for AI's active – or ‘hot’ – datasets.
Complementing Sandisk in the AI storage hierarchy, but serving a slightly different purpose are firms like Seagate Technology ($STX) and Western Digital ($WDC). The two global hard disk drive (HDD) manufacturers store AI’s raw training – or ‘cold’ – datasets. $STX has gained 258% and $WDC 356% YoY.
It’s clear that memory chip stocks have outperformed the market. The question is if there’s more room to run.
Wall Street analysts seem to think so. Mizuho lifted its $MU price target to US$390 with an outperform rating. Bank of America upgraded $SNDK to US$390. Across the board, the consensus is: 2026 will be a memory chip ‘supercycle.’
This is not financial advice nor a recommendation to invest in the securities listed. The information presented is intended to be of a factual nature only. Past performance is not a reliable indicator of future performance. The author of this article and other employees of Stakeshop Pty Ltd may hold positions or have financial interests in the company (or companies) discussed above. As always, do your own research and consider seeking financial, legal and taxation advice before investing.
