Micron’s 300% AI Gain & Tech Spending Risks 03/31/26
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Micron’s 300% AI Gain & Tech Spending Risks 03/31/26
Key Stories:
- Massive artificial intelligence investments by big tech are now facing an energy cost test, according to S&P Global. Tech giants like Microsoft, Amazon, Alphabet, and Meta Platforms had projected spending roughly $635 billion on AI infrastructure for 2026. However, S&P Global Visible Alpha’s head of research, Melissa Otto, warns that persistently high oil prices, exacerbated by the Middle East crisis, could force these companies to revise their capital expenditure plans in the coming quarters. Such revisions could trigger a “really meaningful correction” across all equity markets, a critical watch point for investors tracking the AI boom. Read more
- Goldman Sachs has lowered its price target on Coinbase, the prominent cryptocurrency exchange, signaling a more cautious near-term outlook. Coinbase (COIN) stock has been under significant pressure, dropping about 29% year-to-date and nearly 20% over just the past week. While Goldman Sachs maintained a “Buy” rating on the shares, this adjustment reflects a shift in expectations for the crypto market’s trajectory, even as the firm retains a long-term positive view. Investors should monitor crypto prices and regulatory developments for further cues. Read more
- Shifting gears to another AI beneficiary, Micron Technology, a leading provider of memory and storage solutions crucial for advanced computing, has seen its stock soar by nearly 300% over the past year. This impressive performance highlights a broader trend where companies beyond the immediate chip designers like Nvidia are significantly benefiting from the explosive growth in artificial intelligence. Micron’s role in providing high-bandwidth memory and other components makes it a key infrastructure play for the AI sector, and its trajectory is certainly one to watch for those looking beyond the most obvious AI leaders. Read more
- Moving to traditional sectors, Wells Fargo has adjusted its price target for Automatic Data Processing (ADP), the well-known human capital management and payroll processing company. The firm cut its price recommendation on ADP from $262 to $214 and reiterated an “Underweight” rating. Wells Fargo cited “multiple compression” within ADP’s comparable peer group as the primary reason for the reduction. Despite being recognized as a stable dividend-paying stock, this downgrade suggests that valuation concerns are prompting analysts to become more conservative on even established blue-chip names. Read more
- Finally, Deutsche Bank has also trimmed its price target on Mondelez International (MDLZ), the global snack and beverage giant known for brands like Oreo and Cadbury. The bank reduced its recommendation from $60 to $54 while maintaining a “Hold” rating on the shares. Deutsche Bank noted “legitimate and widespread pressures building” across much of the consumer staples sector, reflecting concerns over rising costs and potential challenges to consumer demand. This indicates that even defensive sectors are not immune to macroeconomic headwinds and cost inflation pressures. Read more
Keywords: AI boom, AI infrastructure, AI stock, Alphabet (GOOGL), Amazon (AMZN), Automatic Data Processing (ADP), Coinbase (COIN), Deutsche Bank, Goldman Sachs, Hold rating, Meta Platforms (META), Micron Technology (MU), Microsoft (MSFT), Mondelez International (MDLZ), Nvidia, S&P Global, Underweight rating, Wells Fargo, capital expenditures, consumer staples, cost pressures, crypto exchange, cryptocurrency, demand concerns, energy costs, equity markets, human capital management, market sentiment, memory chips, multiple compression, payroll, price target, semiconductor, stock performance, year-to-date