Buy Micron Stock, says the analyst. Memory prices improve.

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Micron Technology

actions will come together due to recent improvements in memory pricing, according to RBC Capital Markets.

The chip maker is a leader in the DRAM and NAND semiconductor markets. DRAM, or dynamic random access memory, is used in desktops and servers, while NAND memory is flash memory, which is present in smartphones and solid-state hard drives.

The story back. Shares of Micron (ticker: MU) rose about 40% this year in hopes of a recovery in the chip industry.

In June, the company released better than expected third quarter financial results. During his teleconference at that time, Micron said that the environment of the industry was difficult, but he predicted that the demand in memory would improve later during this calendar year .

What's up. RBC Capital Markets Analyst Mitch Steves On Wednesday, he reaffirmed his Outperform rating for the Micron title, citing better memory pricing.

"We are raising our estimates on Micron to reflect the improvement in the memory environment," he wrote. "We believe that memory prices have improved enough and we do not see any significant downward trend for the end of the month."

Micron's shares rose 0.4% to $ 44.34 on Thursday morning.

The analyst raised his estimate of adjusted earnings per share of Micron for the August quarter from 45 cents to 60 cents. The consensus of Wall Street analysts is 47 cents.

"We remain positive on the stock and think the EPS figures are down," he wrote.

Look forward. Steves reiterated his price target of $ 55 for the Micron stock.

Write to Tae Kim at [email protected]