Micron's positive AI commentary shouldn't come as a huge surprise, but it could nonetheless help support AI plays like Nvidia.
NVIDIA Corp's stock has been seeing new shine lately after some prior cooling of the artificial-intelligence trade - and there's yet another bullish signal for investors on Thursday.
That came from Micron Technology, which issued an upbeat forecast and offered upbeat AI commentary. Those two factors are lifting semiconductor stocks, including Nvidia's, in Thursday morning action.
Mizuho desk-based analyst Jordan Klein flagged Micron's "bullish guide and comments talking up strong customer demand from AI and regular high-performance servers." Additionally, the company mentioned that all of its capacity for high-bandwidth memory is sold out through the end of next calendar year. These are all suggestive of "very positive demand and growth" for high-end computing players, according to Klein.
Is that a surprise to Wall Street? Not really. "We sort of knew this," Klein wrote in a note to clients Thursday. That's evidenced by the recent strong moves in shares of Nvidia, Advanced Micro Devices and Broadcom shares over the past week or so, he said.
But even so, the commentary from Micron could lead to more "fast-money buyers" for AI computing plays, he added. Various semiconductor plays look "a lot better" to him after Micron's call.
Cantor Fitzgerand's C.J. Muse added that Micron "should help all of semis, in particular the AI basket," which is his "favorite area for outperformance" in looking at the balance of the year. He called Nvidia, Broadcom, Micron, Marvell Technology and Teradyne ways to play that trend.
Nvidia shares were about flat at recent check, after having been up as much as 3.4% earlier in the session. AMD shares are up 1.8%, Broadcom shares are up 0.7% and Marvell shares are ahead 2.1%. Micron's stock is up 15%.
While Intel's stock has been on the outside looking in for most of the year, it's seen momentum recently and that could continue into Thursday, with the stock up fractionally.
Intel "would benefit from less-bad PC commentary from [Micron], and they definitely get helped from better general server demand," Klein wrote. The company doesn't have "any real AI compute presence," he noted - but shares still could move 10% to 20% higher "on nothing" if the semiconductor stock rally broadly reignites.
The PHLX Semiconductor Index SOX is up 2.6% with all components in positive territory on the day.