Shares of Micron Technology climbed to a record intraday high on Tuesday after UBS issued a dramatically higher price target, with the bank contending that the rise of AI has fundamentally altered how the company deserves to be valued.

UBS analyst Timothy Arcuri raised his price target to $1,625 from $535 — a Street-high figure that implies roughly 116% upside from Friday’s close, according to CNBC. Early trading saw the shares jump over 10%, a move that marked Micron’s 30th intraday record of the year.

Should the stock reach that level, Micron’s total market value would swell to an estimated $1.8 trillion — enough to place it seventh on the list of largest U.S. companies, trailing only Nvidia, Alphabet, Apple, Microsoft, Amazon, and Broadcom, while surpassing Tesla, Meta, and Berkshire Hathaway, according to Yahoo Finance.

Central to the call is a shift in how Micron signs deals with customers. Arcuri noted that newer long-term agreements, typically lasting three to five years, now include fixed volume commitments and a partially fixed pricing structure — a departure from prior contracts that were based purely on volume, according to CNBC. According to Arcuri, the arrangements benefit Micron by evening out its earnings and revenue trajectory while giving investors clearer insight into how much demand customers have already committed to.

For years, Wall Street priced Micron as a company at the mercy of volatile DRAM and NAND memory cycles, buying during troughs and selling during peaks. Arcuri argued that AI is breaking that pattern by providing the company with more predictable demand. “The market will start to put a more ‘normal’ multiple on the stock and MU will continue to re-rate higher,” he said, according to CNBC.

UBS kept its buy rating in place, a stance broadly shared across Wall Street — LSEG data cited by CNBC shows that 43 of the 46 analysts who cover Micron carry a buy or strong buy recommendation. The stock has gained 704% over the past year.

The move lifted the broader chip sector. The Philadelphia Semiconductor Index hit an intraday record after Tuesday’s opening bell. Other semiconductor names also moved higher in early trading, with Marvell Technology, ON Semiconductor, Advanced Micro Devices, Lam Research, and Qualcomm all posting gains, according to Yahoo Finance.

The analyst did not dismiss the risks entirely — a weakening in high bandwidth memory demand, he warned, could send the stock down to $250, according to CNBC.