This article first appeared on GuruFocus.

Micron Technology (NASDAQ:MU) got a big vote of confidence from Morgan Stanley, which called the chipmaker a new Top Pick as DRAM prices surge to multi-year highs.

In a Thursday note to investors, Morgan Stanley lifted its price target to $325 from $220 and kept an Overweight rating, saying DRAM spot prices, particularly DDR5, have tripled in recent weeks. The bank said it hasn't seen a move this strong in memory pricing since the 1990s.

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The analysts, led by Joseph Moore, believe Micron is entering uncharted territory for earnings as demand for advanced memory chips continues to outpace supply. They expect DRAM prices to rise another 15% to 20% through the first half of 2026, with some deals jumping as much as 50%.

Morgan Stanley added that while investors may worry the rally won't last, this time could be different because global demand growth is far exceeding capacity expansions from suppliers like Samsung (SSNLF) and SK Hynix.

Micron shares have already soared nearly 190% this year, underscoring renewed optimism around the chip industry's rebound and the growing momentum in the semiconductor cycle.