Prediction: Micron Stock Could Turn $10,000 Into a Much Larger Sum by 2030

A $10,000 investment in shares of Micron Technology (NASDAQ: MU) made three years ago is now worth more than $143,000, and this multibagger performance has been driven by terrific growth in the company's revenue and earnings.

The biggest factor behind this stunning surge in Micron stock is the incredible demand for memory chips, which has caused a severe supply shortage and driven prices to astronomical levels. Investors, however, are now wondering if there is room for further growth in memory prices.

That probably explains why Micron stock has pulled back 17% from the 52-week highs it reached toward the end of June. Savvy investors, however, have been capitalizing on the drop in Micron's shares. The 14% jump in Micron stock over the past month suggests that investor confidence in the company's prospects is improving once again.

Let's see why that's the case.

The memory supercycle is here to stay until 2030, at least

Memory chips play a central role in artificial intelligence (AI) data centers. The dynamic random-access memory (DRAM) manufactured by Micron is used in AI accelerators, such as graphics cards, custom AI processors, and even central processing units, to ensure that huge data sets are quickly fed to these chips to run AI workloads seamlessly.

AI accelerators use a specialized type of DRAM known as high-bandwidth memory (HBM), which is manufactured by stacking multiple DRAM chips into a single package. As a result, producing one HBM unit requires 3x the wafer capacity needed to manufacture a conventional DRAM unit. This explains the ongoing memory shortage.

Memory manufacturers have been ramping up HBM output to meet demand from AI data centers. That's not surprising, as Bank of America sees the HBM market jumping 7x by 2030, generating $246 billion in revenue by the end of the forecast period. The investment bank has a price target of $1,550 on Micron, implying 55% upside.

However, I think Micron could deliver bigger gains by the end of the decade, especially considering that DRAM demand could exceed supply by 22% in 2030, according to equity research provider Citrini Research. This shortage is likely to keep DRAM prices elevated until the end of the decade, paving the way for more upside in Micron stock.

It is still a good idea to invest $10,000 in Micron

Micron will report its fiscal 2026 results on Sept. 30. The company's earnings per share are projected to increase by almost 9x in the recently concluded fiscal year to $73.40. What's more, Micron's earnings could increase by 111% in fiscal 2027 to $155.03. Importantly, analysts expect Micron to clock solid triple-digit earnings growth over the long run.

Data by YCharts

But even if Micron's bottom line increases at a very conservative annual rate of 20% until fiscal 2030, its earnings per share could reach $267.89 by the end of the decade (from $155.03 per share in the current fiscal year that has just begun).

If Micron trades at even 10 times earnings in 2030, a significant discount to its trailing earnings multiple of 21, its stock price could hit $2,679. That's just over 2.6x its current stock price. So, Micron could turn a $10,000 investment into more than $26,000 in the next four years, suggesting that it isn't too late for investors to buy this AI stock.

Bank of America is an advertising partner of Motley Fool Money. Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool has a disclosure policy.