(May 18): Major Wall Street firms are doubling their price targets on Kioxia Holdings Corp after the Japanese memory-chip maker gave a stronger-than-expected outlook.
Citigroup Global Markets Japan Inc, JPMorgan Securities and Morgan Stanley MUFG Securities Co all rushed to hike their targets since Kioxia’s earnings Friday showed profit soared. Morgan Stanley designated the company as its top pick, saying growth in real-world use of AI is expected to continue, and that Kioxia has solid free cashflow and shareholder return potential.
That’s even after the shares surged almost 2,000% over the past year, driven by demand from global AI data centre buildout, and turning Kioxia into the world’s best-performing major stock this year. The company was untraded in a glut of buy orders Monday and was set to jump by 16%, its daily limit.
On average, the price target for Kioxia climbed about 44% to ¥63,843 (US$402) as of Monday, from just over ¥44,000 the day before the earnings announcement. That marks the biggest post-results jump among companies on Nikkei 225 Stock Average and would be an increase of over 40% from Friday’s close.
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The former unit of Toshiba Corp’s chip business has historically focused on NAND, the fast storage technology that replaced hard drives in everything from laptops to large-scale data centres.
Its Korean competitors also make DRAM, which performs a similar function, but they have recently allocated more resources to high bandwidth memory, allowing Kioxia to field more orders in the NAND market.
Uploaded by Liza Shireen Koshy
