Bank of America expects memory-chip makers’ earnings to remain near historical highs through 2028, even as growth slows, a view that challenges fears of a reversal in AI-related demand.
For 2027 and 2028, the bank projects that average selling prices for memory chips, revenue and profit margins will stay around the levels of the current boom. Its forecast allows for slower earnings growth while keeping the amount chipmakers earn close to past highs.
The bank sees the recent fall in U.S.-listed memory-chip shares as excessive relative to the companies’ business fundamentals. It says valuation multiples for those stocks have reached a cycle floor. That position extends its earlier assessment that memory-stock losses exceeded what company fundamentals justified.
Morgan Stanley offered a more cautious interpretation on Oct. 13. It warned that low earnings-based valuations for Samsung and SK Hynix may occur near a peak in the memory cycle. Bank of America’s outlook covers U.S.-listed shares; Morgan Stanley’s warning focused on the two South Korean companies.
