Micron Is Rebounding. Why Goldman Prefers These Memory Stocks. -- Barrons.com

By Adam Clark

Micron Technology stock looks to be attracting some bargain hunters finally. But Goldman Sachs says South Korean peers SK Hynix and Samsung Electronics are still more attractive in the memory-chip sector after the recent selloff.

Micron shares were up 6.2% at $769.74 in premarket trading. That comes after a 21% slump over the past month, hit by fears the artificial-intelligence boom is set to slow due to Democratic-led opposition to data centers.

As Barron's has written previously, Micron looks absurdly cheap on its forward price-to-earnings ratio. But skeptics argue PE ratios are an inappropriate tool to value memory companies as they inevitably appear cheap at the peak of a cyclical boom before earnings subsequently collapse.

So Goldman's James Schneider and colleagues prefer to judge the sector by price-to-tangible book values -- a conservative measure of book value that strips out goodwill and other intangible assets and roughly approximates what might be received by shareholders after a liquidation.

"Global memory stocks have historically found a bottom around their tangible book values. Several global memory names...are beginning to approach these levels, with Samsung/SK Hynix now below total book," Schneider wrote in a research note this week.

Goldman has Buy ratings on both SK Hynix and Samsung. Of course, American investors have to weigh whether they want to, and are able to, invest in Korean stocks. SK Hynix has American depositary receipts -- which were rising 8% Wednesday -- but the ADRs trade at a more than 40% premium to the Korea-traded shares.

Meanwhile, Micron still trades at around 5.4 times its tangible book value, according to Goldman. Therefore Schneider retains a Neutral rating on the stock, although admittedly with a $1,250 target price that would imply significant gains from here.

"We...believe risk/reward is becoming more attractive for Neutral-rated Micron in light of the high probability of strong free cash flow in the coming quarters," Schneider wrote.

Write to Adam Clark at adam.clark@barrons.com

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November 11, 2026 06:38 ET (11:38 GMT)