The Memory Rebound Just Got Real

Hey guys, welcome back. Hope you're doing well. Still here in Vegas, starting to feel a little better, but my voice is still a mess. But I had to get my insights out today for what we saw in the trading action. Because you know, over the last 48 hours, we have seen the volatility. It has been absolutely relentless in the memory sector overall. What we've seen happen with the memory titans, the Fab Four, it's been a bit of a seesaw action over the last 48 hours. We saw a over the last 48 hours. We saw a vicious macro -driven sell -off. It briefly shook weak hands out of the semiconductor space. But as we discussed in our last video, panicking over macro noise while ignoring the massive underlying hardware demand or the signals that we see in the marketplace is often how retail investors frankly, just get left behind. Today, the chip sector, it staged a powerful data -driven rebound led by exact structural layer that we've been tracking on this channel, memory and storage. While the mainstream media is busy reacting to daily price swings, smart money is actually looking at the orders that are hitting the tape. I want to pull up our article that came from the Diversified Financial Services B. Riley that lays out what he expects to see with the CapEx spending. So let me pull that up. You can see the title on your You pull that up, you can see the title on your screen. It's all about the chip market, the U .S. earnings season's kickoff. Of course, they're talking about the two massive earnings that we'll see this week in ASML and TSMC. Let's scroll down and see what the report has to say. You can see that's what they mentioned here. We're going to see ASML and TSMC's second quarter reports this week. They will serve as bellwethers for the broader semiconductor and semiconductor equipment industries. Further on, you see B. Riley, which is a diversified... Further on, you see B. Reilly, which is a diversified financial services firm, B. Reilly's core thesis is that the acceleration in global hyperscaler AI -related CapEx has exceeded its own prior expectations. And the earnings report from ASML and TSMC will provide critical insights into the spending trends of global tech giants on AI infrastructure. Take a look down here on what they're calling out. Currently, combined AI -related CapEx guidance from major U .S. hyperscalers for fiscal 2026 have surged to approximately $695 to $725 billion, a level that B. Riley had originally projected for fiscal year 2027. So therefore, they have revised their estimate for a total global AI -related CapEx spend this year. to reach approximately $880 billion, with next year potentially surpassing the $1 trillion mark. This is a massive signal for the memory sector, for the storage sector as well. When we're seeing this level of investment from the hyperscalers, it is just going to drive the demand that we need for memory in the marketplace. This is a strong signal, and I do think the earnings report that we see from ASML and TSMC will drive a bullish flag for the memory sector i think it'll drive us into the weekend into the green with a couple of strong days left in the week but let's take a look at asml right now you can see the adr here in the u .s had a strong day today up about three percent fifty dollars for each adr closed at 17 .75 but if you look in the after hours we're up another 41 for that adr so it's anticipating we're starting to see an anticipation of a strong print. And if we scroll down and just take a look at some of the price targets that have come in, let's see if any of that has changed. Right now, we saw RBC Capital on the 13th. They revised from 17 to 2000. So a little bit of a upside. We see Bernstein earlier in the month went up to about twenty six hundred for this ADR. So about a forty seven percent upside from where we sit today. But it's all being driven right now in anticipation of what their earnings will be. They drop into the street tomorrow. They drop into the. I think it's going to be a bullish flag, as I mentioned, for the memory sector. And let's see how the memory titans did today. If you take a look at Micron, it kind of feels like a seesaw, if I'm being honest, because we're down by about 5 % yesterday. We're up by about 5 % today. But the after hours right now is signaling a little bit of a shift. We're up $16, right about that $1 ,000 mark. I have a feeling we'll pass the $1 ,000. We'll get through that psychological level again tomorrow for Micron, and let's hope we continue to build upon that momentum. Let's keep pushing towards the price targets that we see in the market right now. Because if I scroll down here for Micron, you'll see the analyst sentiment is still strong buy, and the price target is just under $1 ,500 a share. Guys, that's a $51 upside from where the stock is today, where it's trading based on what the analysts say and by scroll down here you can see where it's trading based on what the analysts say. If I scroll down here, where the new new targets came in so key bank they dropped a new target into the market today they went from 1600 to 1750. that's the article that i was going to pull up you can see key bank maintains micron as an overweight with a price target at 17. so this is a strong target with everything that's happening with the memory sector with micron right now to see key bank come out and drop this price target is a really strong sign. And it's based on three factors overall. So and drop this price target is a really strong sign and it's based on their analyst, John Vinn, he did a visit, an extensive kind of supply chain trip across Asia. And his checks, in his opinion, it confirmed everything that we need to know about the memory shortages. And he mentioned that they are not a short -term blurb. They are structurally locked in, these shortages throughout 2027. Vinn was so confident in the underlying metrics that he Vin was so confident in the underlying metrics that he raised that price target to what we just raised that price. showed you, to $17 .50. And it's all based on a couple of factors. The reason he drove that price target up is based on the DRAM pricing. He mentioned that it's projected decline another 15 % to 20 % in Q3 of this year, followed by an additional 15 % in Q4. NAND pricing, when he looked at that, he's anticipating it to skyrocket 30 to 40 % in Q3. Anticipating it to skyrocket 30 to 40 percent in Q3 this year, followed by another 15 percent step up in Q4. And finally, with HBM premium pricing, it's on pace to more than double by next year. So these metrics are accelerating so quickly right now, and they're accelerating because of HBM, the high bandwidth memory, whether it's HBM 3E or HBM 4. We know they require significantly more wafer consumption compared to DDR5 memory. And this is why I think this is a bit of a sleepy, bullish sign that we haven't talked about much. We talked about it a little bit on a few videos ago, but the fact that Micron has locked up a 10 -year supply with global wafers to ensure that they can get the wafers that they need, many are mentioning that this very well could be the next bottleneck that we see in the market. That wafer supply could be a bottleneck that we see in the market and a severe shortage of that we see. it overall. So I love the fact that Micron, they plan to invest $3 billion to strengthen the U .S. semiconductor supply chain, and they have a $500 million strategic financing package with global wafers. It's a 10 -year supply agreement. So if, in fact, this is the next bottleneck, access to wafer supply, the fact that Micron just locked up a 10 -year agreement. with global wafers is a huge underestimated, I think, underappreciated sign in the marketplace. Such a strong move for Micron overall. But this is what we're seeing right now. We're seeing that HBM, as you know, it drives more. Every single gigabit of HBM produced manufacturers, we know they have to sacrifice nearly three gigabits of standard DRAM capacity. This creates a severe structure. DRAM capacity. This creates a severe structural deficit for the PCs and the smartphone market overall. The memory that's needed for those devices, that market is strangled right now from what we're seeing. And that's why we're seeing price move for those consumer goods overall. But this deal, it allows Micron to flex the massive pricing power that they'll have across the entire portfolio. As I mentioned, it's such a, in my opinion, such an underappreciated deal in the marketplace. But I wanna jump over to SanDisk as well. That's the other one I wanted to talk about in today's video. You can see that SanDisk jumped by $83 today. We know they were down by over $200 yesterday. I think it was almost 13%, picked up 5 % back today, up almost 2 % in the after hours, closing in on just about $1 ,800 a share again. And if we look down at their technical analysis, this it is a buy remember micron was a strong buy sandisk is a buy but their price target right now it is a buy. Remember, Micron was a strong buy. SanDisk is a buy. is at about 2100 so you're seeing about a 20 upside in that price target from where the stock trades today but there was a few really bullish signs and signals in the market today overall right here webbush i love this article when i saw it related to sandisk it says webbush pounds the table by saying this before the august 5th earnings if you scroll down here you see webbush they hiked If we scroll down here, you see WebBush, they hiked its revenue and earnings target by quadruple digit basis points, its revenue pushed both above consensus and warned that these aggressive moves may underestimate the company's strength. As it stands, WebBush sees revenue approaching $9 billion for the fiscal fourth quarter, earnings per share exceeding $37 .50, and the strengths persisting into subsequent years. As we further go on, it says the consensus forecast suggests As they further go on, it says the consensus forecast suggests revenue of $8 .33 billion and adjusted earnings of $34, representing more than 11 ,000 % growth over the prior year for SanDisk. But they believe the price can double from here, WebBush. has an aggressive 62 % price target increase. Its 2 ,000 forecast falls short of the high -end range. revisions in early july put this in the market of 3 000 to 3 200 per share that's Revisions in early July. Put this in the market. what webbush is saying right now it's sufficient for nearly a hundred percent upside from mid -july support targets right now if we scroll down here i'll show you where it stands on their page as well you can see it wasn't just we don't see it right it did but evercore isi also has a 3 100 dollar price target issued july 12th it's a brand new target for the company As you can see here, they didn't have a prior target. But just look at the price targets we see for Sandus now. All in the range of $2 ,200 up to $3 ,100. We know that WebBush just pounded the table based on what they're seeing from Sandus to get to a $3 ,200 price. These are massive conviction plays for these analysts community, for these analysts overall for the company. And if you look at some of the underlying kind of mechanics, we know that DRAM handles the fast localized processing workloads, but SanDisk's high -density NAN and enterprise SSDs are heavy -duty reservoirs holding the vast data sets used to train LLMs. The institutional data for SanDisk tells the entire story. If we look at their float right now, institutions carry, they control, institutions control almost 80 % of SanDisk's active. float. Institutional buyers are outnumbering sellers at a sharp two -to -one ratio. What do you think that tells you when you see institutional buyers outpacing the sellers at a two -to -one ratio? It is showing you that the whales are there. They're stepping in. They're supporting the stock. And we're seeing that engineer samples for their high -bandwidth flash is going to ship later this year. alongside long -term enterprise supply agreements that are running out three to five Alongside long -term enterprise supply agreements. years. That's another bullish sign for Sandisk, the fact that they have these supply agreements that are running out three to five years. I don't think it mentions it here, but I think as I scroll down here into the Evercore target, you'll see it right here in this article that the company has signed three deals in its fiscal third quarter, totaling $42 billion of remaining performance obligations, and two additional deals early in the fiscal fourth performance obligations, and two additional deals. quarter with undisclosed balances. This also is an underappreciated move by Sandisk in the marketplace right now. Evercore estimates that all five deals represent approximately $62 billion of minimal committed revenue over the next several years, with more than $11 billion of financial guarantees and prepayments. The firm projects that over one -third of Sandisk's fiscal 2027 bits will be tied to these agreements at a gross margin above 80%. So this is a big move as well for SanDisk. I think this also gives me conviction for this stock long term. When you see what they're going to deliver, when you see these agreements with $42 billion of the three, counting for, I think they said $62 billion when all five get announced. The revenue visibility that you see for this company is huge. It is trading at $1 ,800. right now when most price targets are in the $3 ,000 range. So guys, you have to assess that against your own individual risk tolerance. But in my opinion right now, it is a strong opportunity to have an entry point into SanDisk if you were looking for one. But I also want to jump and just finish the video with just kind of taking a look at SK Hynix. Because we saw SK Hynix and it's kind of, I think it's second day of trading now for its ADR. It closed today at $193 .92, up almost $42 on ADR, just over a 27 % increase. Seen a little bit of pullback in the after hours right now, but guys, the price targets that I'm seeing right now for this ADR are in about 300 range, 335. There's only one right here. You can see the average price target is 355, so about an 80 % upside from where the stock is trading today. Analysts can see So about an 80 % upside from where the stock is trading today. Analyst consensus, as you can see, is only one analyst that's covering the ADR right now, but he's listing it as a strong buy for the company. The reality that we're seeing in the marketplace right now is that this ADR, it represents a staggering 44 to 50 % premium over its core domestic, over the South Korean shares for SK Hynix. So this is a massive premium. And why are we seeing that massive premium? Part of the reason is because IBM's recent Q2 update confirmed that massive premium? Part of the reason is because IBM's recently the massive late quarter scramble for enterprise buyers into the storage and memory infrastructure to front run the price hikes that we're going to see. And because SK Hynix is trading at a Ford PE of under 6x right now, US institutions are aggressively using the ADR as a liquid, cheaper proxy to gain exposure to this company right alongside Micron. So that's why we're seeing that move. Meg, as I mentioned, it is listed right now as staggering 44 % to 50 % premium over its core domestic South Korean shares. So right now we're seeing some big moves with SK Hynix. So let's see if it can continue tomorrow. We're seeing a little bit of pullback, probably a little, we'll see, maybe a little bit of profit taking. Maybe we'll see what it does when the opening bell rings tomorrow. We did see some capital rotate back into the other players like we saw with micron sandisk western digital into the other players like we saw with Micron. was up today also seagate was up as well but i want to finish today looking at the article that came out from hb from hsb you can see here hsbc defends memory trade says it's too early to be concerned if we scroll down you can see hb hsbc is standing by its bullish view on memory asian chip makers arguing that investor concerns over a potential peak in the semiconductor cycle are premature. But the analysts pointed out that the fresh catalysts are emerging, including anticipated price increases for HBM following a rally in commodity DRAM, as well as further average selling price gains for HBM4 adoption begins. They also highlighted growth in the SOCAM2, a mobile DRAM -based module tied to the expansion of ARMS -based CPUs. and the additional upside in NAND demand from context memory storage used for AI agents. The long -term agreement spanning three to five years should improve earnings, the earning visibility over the next two to three years, and reduce the earnings volatility, which could support higher valuations, the analyst said. Finally, HSBC compared the current memory cycle to the 1990 -1995 PC super cycle, arguing that agentic AI should current memory cycle to the 1990 -1995. improve office productivity and reshape workflows. The analysts believe cloud service providers are unlikely to slow capacity expansion as they compete for a fast -growing market and expect the coming HBM4 transition to accelerate HBM price increases relative to commodity DRAM. So this is all the reasons why you see HSBC defend the memory trade So this is all the reason. and basically say it is too early to be concerned. And these are the clear takeaways that we're seeing in the market today. It's an overarching kind of technical takeaway for today, and it is very clear in my opinion. When you take a look at everything we saw this week, when we are right now in the position ahead of major ecosystem earning updates with ASML and TSMC. that we'll see later this week, the actual structural demand for high -performance memory and enterprise NAND is outstripping Wall Street's legacy models. Between the massive CapEx adjustments, structural supply deficits caused by HBM wafer consumption, and the intense institutional accumulation, recent market sell -offs look like premier entry points for companies that are in the memory. value chain but let me know your thoughts in the comments below are you viewing it the same way are you holding micron are you feeling anxious about the memory sector right now or are you scaling into these players for the next massive growth the next leg up that we're going to see in the memory trade but guys in the end don't forget to hit the like button smash the subscribe if you're not part of the community I want you to be here so you can receive the daily institutional data updates and the sector updates that I provide to this channel and guys I'll see you in the next one. I hope you're having a great night