Memory chip price target cuts
Mizuho lowered price targets across several memory and chip-equipment names this morning, but stayed bullish. It kept outperform ratings (equal to a buy) on all of them. The cuts reflect where valuations sit and what investors will pay, not a weaker business.
- Micron (MU): target cut to $130 from $137.50
- SanDisk (SNDK): cut to $187.50 from $190
- Applied Materials (AMAT): cut to $590 from $650
- Lam Research (LRCX): cut to $365 from $370 (a $5 trim)
Memory stays a key bottleneck. The core story is intact, but "watch the price you pay." The moves are mainly about multiple compression - lower PE ratios, not falling demand. Memory still matters to the AI story because AI chips do not work alone; GPUs and AI chips need large amounts of memory to store and reach data.
Nvidia raised on CPU growth
Nvidia (NVDA) traded up more than 1%. Raymond James raised its target to $352 from $330 and kept a strong buy rating. The call goes beyond the GPU business to a growing chance in CPUs, which could add another leg to Nvidia's growth. CPUs are just 3% of Nvidia's sales today, but Raymond James expects that to reach about 5% of total revenue by 2028, and to be Nvidia's fastest growing business. It sees a path for Nvidia to become the world leader in CPU revenue within several years. The firm also holds constructive views on AMD (AMD), which it covered this morning too.
The next driver is agentic AI. These systems reason, work through tasks, use tools, retrieve information, and take multiple actions, which supports the CPU growth view. Nvidia's earnings are due tomorrow - a big test, with high expectations around GPUs, CPUs, and the backlog for its Rubin and Blackwell chips. Options activity was heavy the day before, with a mix of bullish and bearish plays.
United Airlines international expansion
United Airlines (UAL) rose more than 1.5% (up 1.7% at one point) after announcing its biggest ever international expansion: 10 new international cities plus more routes across Europe and Asia, starting in 2027. It already flies to more than 160 international destinations. Eight of the 10 new cities are not served non-stop by any other US airline, widening its lead in global reach. The strategy is to fly where other carriers do not. Beyond Paris, Rome, and London, new spots include Ibiza, Valencia, Sardinia, and Marseille. Newark airport is a clear winner and a key hub for this expansion. Airlines face higher jet fuel costs, but demand looks strong enough to support the new routes and the fall outlook.
