Micron Technology Inc (NASDAQ:MU) shares rose more than 7% on Wednesday amid easing geopolitical tensions in the Middle East, as UBS raised its price target on the memory chipmaker, citing improved pricing and long-term deal potential.

The firm upped its price target on ‘Buy’-rated Micron to $535 from $510, implying significant upside from current levels of about $405.

“Despite sentiment around memory that has turned very negative post MU’s gross margin guidance, we continue to believe we are in the midst of a super-cycle that will likely defy traditional analytical norms for the stock,” the analysts wrote.

UBS wrote that its latest industry checks point to continued strengthening in pricing across both DRAM and NAND, with particularly strong momentum in high-bandwidth memory (HBM), a key component used in artificial intelligence workloads. UBS expects HBM pricing improvements to support margin expansion over time.

It also highlighted increasing discussions between memory suppliers and large customers, including hyperscale cloud providers and original equipment manufacturers, around long-term supply agreements.

These arrangements are expected to include volume commitments, prepayments, and structured pricing bands, which could improve revenue visibility and reduce earnings volatility.

In NAND, UBS noted that not all suppliers appear equally inclined to enter such agreements, with some opting to retain flexibility in allocating production capacity.

Still, the broader trend suggests memory companies are increasingly willing to trade near-term upside for longer-term stability in earnings and returns.

UBS added that supply constraints, particularly in DRAM, could extend into 2028, reinforcing its view that the current upcycle may prove more durable than in previous cycles.

The firm forecasts Micron’s earnings per share could reach approximately $135 in 2027 and $120 in 2028, both above broader market expectations.