Should You Buy Micron Technology Before Its Dec. 17 Earnings Report?

As Micron Technology (MU) prepares to release its earnings report on December 17, 2025, investors are scrutinizing the stock's valuation, recent earnings performance, and alignment with long-term industry tailwinds. With the semiconductor sector poised for a transformative phase driven by artificial intelligence (AI) and high-bandwidth memory (HBM) demand, the question of whether to buy Micron before its report hinges on a nuanced analysis of these factors.

Valuation: Undervalued Relative to Peers and Fundamentals

Micron's current price-to-earnings (P/E) ratio of 29.7x to 31.7x is significantly below both the semiconductor industry average (34.1x to 38.0x) and the peer group average (88.0x to 89.2x) according to data. This discrepancy suggests the stock is undervalued relative to its growth trajectory and risk profile. Furthermore, the company's P/E ratio lags its calculated Fair PE Ratio of 42.7x to 49.6x, indicating a potential discount to intrinsic value.

The price-to-book (P/B) ratio also tells a compelling story. While the semiconductor industry's average P/B ratio in 2025 is 11.12 according to industry data, Micron's P/B ratio has risen to 3.89 according to reports, reflecting a growing recognition of its book equity. This trend, combined with historically volatile P/E metrics peaking at 145.72 in 2024 before normalizing to 24.69 in 2025, underscores a recovery in earnings and investor confidence.

Earnings Momentum: Outperforming Expectations

Micron's recent financial performance has been nothing short of stellar. In Q3 2025, the company reported record revenue of $9.3 billion, a 15% sequential increase and 37% year-over-year growth according to earnings data. This was driven by all-time-high DRAM revenue and a near 50% sequential surge in HBM revenue according to financial reports, a critical component for AI and data center applications.

The company's Q4 2025 guidance of $10.7 billion in revenue was exceeded, with actual revenue reaching $11.32 billion and earnings per share (EPS) hitting $3.03 according to financial analysis. This outperformance was fueled by a favorable supply-demand balance and surging demand for high-performance memory solutions according to market reports. Such momentum positions Micron to deliver robust results in its upcoming report, particularly as AI-driven demand continues to accelerate.

Long-Term Industry Tailwinds: AI and HBM Growth

The semiconductor industry is entering a new era of growth, with AI and HBM at the forefront. Gartner forecasts that global semiconductor revenue will grow by 14% in 2025 to $717 billion, with AI-related demand-particularly for GPUs and HBM-driving much of this expansion according to market research. HBM revenue alone is projected to increase by 66.3% in 2025, reaching $19.8 billion according to forecasts, while HBM is expected to account for 19.2% of DRAM revenue this year according to analysis.

Beyond 2025, the AI hardware market is forecasted to grow at a 23.2% compound annual growth rate (CAGR) through 2035, reaching $231.8 billion according to market projections. Micron is strategically positioned to capitalize on this trend. The company has secured pricing agreements for most of its 2026 HBM3E supply and is preparing for a transition to HBM4, with early samples demonstrating industry-leading bandwidth and power efficiency according to company announcements. Additionally, Micron's investments in DDR5, LPDDR5X, and 3D NAND technologies according to industry analysis align with the growing demands of AI, cloud computing, and edge computing.

Conclusion: A Compelling Case for Investment

Micron Technology's undervalued metrics, outperforming earnings, and alignment with AI-driven growth make it a compelling investment ahead of its December 17 report. The company's leadership in HBM, coupled with its aggressive R&D investments and capacity expansion, positions it to benefit from the semiconductor industry's long-term supercycle. While short-term volatility is inevitable, the confluence of favorable fundamentals and macroeconomic tailwinds suggests that Micron is well-positioned to deliver outsized returns for investors with a medium- to long-term horizon.