Citi changes Intel and Micron valuations amid chip market dynamics. Is it worth buying?

Citi analysts have revised their estimates of the largest chipmakers, raising their recommendation on Intel and at the same time excluding Micron from the list of priority ideas. The investment company sees tactical opportunities for Intel against the backdrop of competitors' limitations, but points to remaining risks. Whereas on Micron, analysts say, a slowdown in DRAM memory price growth is expected.

- Citi analysts raised their recommendation on Intel shares from "sell" to "neutral" , which corresponds to a "hold" rating, and increased the target price of the company's shares from $29 to $50, Gurufocus writes. This target implies a 4% increase in the company's securities relative to the closing price on January 15, writes SeekingAlpha. Intel may be in an advantageous position because of its limited offering of advanced chip packaging services from the world's largest chip maker, TSMC, Citi notes, Gurufocus notes. In addition, Intel has a "unique window of opportunity, with the support of the U.S. government, to attract customers from silicon wafer manufacturers," Citi analyst Atif Malik noted.

However, despite these positive factors, as well as the participation of the U.S. government in the company's capital and the prospects of "stabilizing" capital expenditures - Intel, according to the analyst, has not yet fully emerged from the crisis. The company is expected to lose processor market share to AMD and Arm, says Malik, noting that the company may also face the risk of weakening the PC market amid rising prices for memory chips. Before recommending the company's securities for purchase, Intel must prove its ability to recover, the analyst said.

Shares of Intel at the premarket on January 16 added 1.7%. Since the beginning of 2026, the company's securities have risen by 31% - the third best result in the S&P 500 index, notes Bloomberg. After rising 84% in 2025, the company's shares on January 15 approached the maximum levels for the last two years. The stock has recovered from a 60% drop in 2024, when Intel looked to be lagging behind rivals that have been able to capitalize on the boom around artificial intelligence. "It [Intel] was like coming back from the other side of the world. It was painful to own this stock, but now it's a pleasure," said Kim Forest, chief investment officer at Bokeh Capital Partners and a longtime Intel shareholder (quoted by Bloomberg).

- Citi also removed chipmaker Micron from its U.S. Focus List of priority investment ideas in the U.S. market. DRAM RAM price dynamics are likely to slow down in the second quarter compared to the first quarter, Malik said. "Micron shares tend to move following quarterly price movements. At the same time, we expect the supply-demand balance in the memory market to continue through 2026-2027 - on the back of limited availability of manufacturing capacity (fab space - chip plants) and robust demand from the AI segment," the analyst added. Micron's stock jumped 5% on the premarket on January 16, adding 218% over the past 12 months.

Earlier this week, KeyBanc analyst John Vinh raised his recommendation on Intel shares to buy (Overweight rating), pointing to strong demand, progress in the company's foundry business, as well as a potential agreement with Apple on the use of Intel chips in computers and iPhones. Also, the target price for Intel's securities was raised by Barclays from $35 to $45 on January 15 (the recommendation remained at the same level - "neutral"). This target implies a 6.8% drop in Intel shares relative to the closing price on January 15.

Of the 46 analysts covering Intel stock, the majority - 33 - advise holding the stock. Seven recommend buying the company's securities and six recommend selling them.

As for Micron, on January 15, analysts of Wells Fargo revised their target price for the company's shares: they raised their target from $335 per share to $410, while maintaining a "buy" recommendation for Micron shares (Overweight rating). This assessment assumes growth of the company's securities by 22% relative to the closing price on January 15. In addition, this week from $275 to $450 target price of Micron shares was raised by analysts of Barclays, also maintaining the recommendation to buy. The bank's assessment implies growth of Micron securities price by 34% relative to the current level.

36 out of 42 analysts watching Micron securities recommend buying them. Four advise to keep them in the portfolio and two - to sell.

This article was AI-translated and verified by a human editor