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Micron Surges 12% as AI Chip Demand Rebounds — Can the Rally Hold?

Micron Technology (MU) surged 12% on July 21 as AI-related stocks bounced back from a steep July selloff. With memory chip tightness expected to persist beyond 2027, the stock still trades at a deep discount to the S&P 500.

OurAlpha

22 Jul 2026 — 3 min read

Micron Technology surged 12% on July 21 as AI-related stocks bounced back from a steep July selloff.

Micron Technology (MU) surged 12.17% on July 21, closing at $970.82 from the prior day's $865.46 close. The move came as AI-related stocks broadly rebounded from a sharp pullback earlier in the month.

Micron (MU) closed at $970.82 on July 21, up $105.36 (+12.17%) from the prior close of $865.46, with an intraday high of $982.88.
Before this bounce, Micron shares had fallen roughly 26% from early July through July 20; Sandisk dropped 40% over the same period.
Micron management said on its latest earnings call that memory chip "tightness" will persist beyond 2027.
As of the July 21 close, Micron traded at a forward P/E of roughly 11.6x, well below the S&P 500's 21.5x.
Sandisk (SNDK) also rebounded on July 21, alongside other chip names like AMD and Marvell.

Micron Technology (MU) had a strong session on July 21, closing at $970.82, up 12.17% from the prior day's $865.46 close. According to Investor's Business Daily, the rally was part of a broader rebound in AI-related stocks, with Sandisk, AMD, and other chip names also moving higher^[^{Source 4}^]. With U.S. markets closed for a holiday, the July 21 close remains the latest available price as of 3:30 p.m. Beijing time on July 22.

Sharp Rebound From July Peak

Micron shares had a blistering first half of 2026. According to The Motley Fool, the stock gained 304% from January 1 through June 30, while Sandisk surged 858%^[^{Source 5}^]. But sentiment turned sharply in July. The same report noted that by July 20, Micron had fallen roughly 26% from its late-June peak, and Sandisk had dropped 40%^[^{Source 5}^]. The July 21 surge marks a powerful recovery after that selloff. According to Investor's Business Daily, broader market sentiment improved, with the S&P 500 reclaiming its 50-day moving average, and memory chip names like Micron and Sandisk leading the tech sector higher^[^{Source 2}^].

Memory Chip Supply-Demand Dynamics

Both Micron and Sandisk produce memory chips. Micron's product line spans DRAM and NAND flash, while Sandisk focuses on NAND flash, widely used in data center SSDs. The Motley Fool notes that AI infrastructure buildout is driving enormous demand for memory chips, which have become one of the biggest bottlenecks in the AI boom, directly fueling chip price increases^[^{Source 5}^].

Addressing concerns about potential overbuilding of AI compute capacity, Micron management gave a bullish response on the latest earnings call. According to The Motley Fool, management explicitly stated that memory chip "tightness" will persist beyond 2027, which the market interpreted as a positive signal for the long-term sustainability of AI buildout^[^{Source 5}^].

Valuation and Market Sentiment

Despite the sharp July pullback, both Micron and Sandisk remain cheap on a forward earnings basis. According to data cited by The Motley Fool, as of around July 20, Micron traded at a forward P/E of roughly 11.6x, and Sandisk at just 6.4x — both well below the S&P 500's 21.5x^[^{Source 5}^]. The report notes that Wall Street has historically been reluctant to assign a full valuation premium to memory chip stocks due to the sector's cyclical nature. But if the market becomes convinced that memory demand will sustain for years, these names could see a re-rating.

Beyond Micron, several other data-center-related names were active on July 21. Investor's Business Daily noted that AMD, Marvell Technology, and other chip stocks all gained, while GM and 3M drew attention on earnings^[^{Source 4}^]. Separately, Super Micro Computer surged after hours on improving margins and order growth, lifting server makers Dell and HPE^[^{Source 1}^].