Micron's stock surges after RW Baird analyst turns bullish

Shares of Micron Technology Inc. ran up 2.5% in premarket trade Tuesday, after Robert W. Baird & Co. turned bullish on the memory chip maker, citing an improving outlook for PCs and the Chinese smartphone market and a positive outlook for NAND flash memory. Analyst Tristan Gerra raised his rating to outperform, after being at neutral for the last nine months. He raised his stock price target to $18, which is 46% above Friday's closing price of $12.31, from $12. "Samsung may shift meaningful capacity from DRAM to NAND this second half," Gerra wrote in a note to clients. "Near term, PC units are rebounding above expectation--off a dismal 1Q--while the China smartphone market is also rebounding." Gerra said he believes Micron's gross margin will begin to stabilize, then rebound somewhat in the second half of the year. The stock has tumbled 13% year to date through Friday, while the PHLX Semiconductor index has climbed 4.9% and the S&P 500 has gained 2.7%.

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