4 Memory Stocks Are Darlings of the AI Boom. How They Differ and Why We Own Micron
While often trading together, these companies are not the same.
TL;DR
- Micron, Sandisk, Seagate, and Western Digital are top performers in the S&P 500, driven by AI data center demand.
- Sandisk leads year-to-date gains, followed by Micron, Seagate, and Western Digital.
- The companies differ in their core technologies: Micron (DRAM), Sandisk (NAND flash), Seagate and Western Digital (hard disk drives).
- DRAM is the fastest and most expensive, NAND is slower but cheaper and retains data without power, and HDDs are the cheapest for mass storage.
- Micron's DRAM, especially High-Bandwidth Memory (HBM), is increasingly critical for training and running AI models.
- HBM is becoming an integral part of the AI computing engine, not just a commodity.
- Micron is benefiting from long-term strategic customer agreements, providing more predictable demand.
- Western Digital and Seagate, focused on HDDs, offer cost-effective solutions for storing large datasets.
- The AI buildout requires a mix of all these technologies, benefiting the entire sector.