Quick Read

• Micron (MU) trades at 9x forward earnings with 118% projected annual EPS growth and 68% revenue growth as hyperscalers compete for memory chips, while the company’s cash position improved to $14.6B against $10.8B in debt. Meta (META) faces margin pressure from rising component costs, with capital expenditures driven by memory pricing rather than capacity expansion, leaving its debt at $83.9B against $81.6B in cash.

   

• Meta and other hyperscalers are redirecting cash flow to semiconductor suppliers like Micron and Nvidia rather than retaining it as free cash flow, giving memory chip makers superior financial positions during the AI infrastructure buildout.

   

   

  Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Meta didn’t make the cut. Grab the names FREE today.

• Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Meta didn’t make the cut. Grab the names FREE today.

During Meta’s (NASDAQ:META) Q1 2026 earnings call, Zuckerberg said something that most other hyperscalers skimmed over. He said that while Meta Platforms was expanding its data center capacity and increasing its spending, he said, “…we are increasing our infrastructure capex forecast for this year. Most of that is due to higher component costs, particularly memory pricing.”

Most investors tend to think data center capacity increases linearly with spending, but this is not the case. In fact, companies like Meta are finding out that even if they are keeping their data center plans constrained, component prices are going out of budget due to the enormous buildout. This only means that you’re going to see higher and higher spending on these data centers from companies like Meta.

And while META stock is discounted right now, there’s a stock that gets you a better discount and is on the receiving end of the windfall.

Buy Micron, not Meta

Micron (NASDAQ:MU) stock is up 841% in the past year and is now officially a company worth over $1 trillion. But the stock is far from pricey when you consider just how much pricing power and growth potential the business has. Micron trades at a mere 9 times forward earnings, and even this may end up proving to be an underestimate.

Remember, MU stock only rallied this much in the past year because Wall Street underestimated how much potential the company had. Memory was long considered to be a highly cyclical industry. And while that may ring true in the end, one should also consider just how much demand there is for memory. By the time this “cycle” ends, you might be losing out on tremendous gains.