Memory stocks gained in premarket trading Thursday as investors continued to favor companies expected to benefit from strong artificial intelligence infrastructure spending and tight memory supply. Micron Technology Inc., Sandisk Corp., SK hynix Inc. and Western Digital Corp. moved higher as demand for AI memory and storage remained strong. The rally follows a sharp pullback in the previous session, where Micron shares fell nearly 3% despite broader optimism about the sector.

AI Spending Keeps Memory Demand High

AI servers require large amounts of high-bandwidth memory (HBM), DRAM, NAND flash and storage. As hyperscalers expand data-center capacity, investors expect memory makers to benefit from firmer pricing and sustained demand. Morgan Stanley's Andrew Slimmon said memory chips and compute power are likely to remain in short supply for the foreseeable future, reinforcing his positive view on artificial intelligence-related investments despite concerns about heavy data center spending.

Speaking on CNBC on Wednesday, Slimmon said Wall Street remains focused on the near-term cost of AI infrastructure, while technology companies are investing aggressively to capture long-term demand. "There's a scarcity of memory chips. There is a scarcity of compute power," Slimmon said. "I don't think that will be resolved in the near future."

Morgan Stanley Sees Multi-Year Tailwind

Morgan Stanley analyst Joseph Moore echoed that view, saying the recent pullback in memory stocks has created an attractive buying opportunity as AI spending continues to tighten industry supply. Moore said memory remains "at the center of every methodology for AI training and inference" and argued that recent weakness reflects short-term concerns rather than a deterioration in long-term demand.

Moore said data center customers continue to view memory as a key constraint on expanding AI infrastructure. He expects that dynamic to support the sector for several years. "We're seeing these second-derivative sell-offs," Moore said. "But the true north here is the strength of the data center and the belief from data center customers that memory's going to be a binding constraint on the ability to ramp AI for really multiple years."

Moore also said the industry is experiencing an unusual period of pricing power. He estimated memory inflation could total about $80 billion this year as demand for high-bandwidth memory, DRAM and NAND outpaces supply. He added that NVIDIA Corporation CEO Jensen Huang recently told investors memory shortages are likely to persist for years, forcing the industry to improve efficiency rather than rely on additional supply.

Analyst Outlook

The stock carries a Buy rating with an average price forecast of $1548.86. Recent analyst moves include:

Price Action

Sandisk shares were up 1.62% at $1625.11, Micron Technology shares were up 2.98% at $988.05 and SK hynix shares were up 6.55% at $176.10 during premarket trading on Thursday.

Micron Technology Inc shares rose over 5% on July 21 after a key trading signal indicated strong buying interest from both retail and institutional investors. The stock, which had been stagnant in the opening hour, surged following a Power Inflow alert triggered at 10:41 AM EST. This shift in order flow highlighted a bullish trend, driving the price to an intraday high of $982.88 by 2:00 PM EST.

Power Inflow Alert Details

The Power Inflow signal is a proprietary indicator provided by TradePulse. Issued within the first two hours of the trading session, the alert identifies significant shifts in order flow toward buying activity. This suggests a higher probability of bullish price movement for the remainder of the day, offering a potential entry point for active traders.

Micron Performance Metrics

The following table details Micron's stock performance following the alert:

Market Implications

Order flow analytics, which examine real-time buying and selling behavior by volume and order size, provided the context for the signal. The immediate price appreciation demonstrates how such analytics can uncover momentum during periods of apparent stagnation. Traders acting on the Power Inflow signal captured significant intraday gains, underscoring the utility of monitoring order flow data.