Plans for blockbuster initial public offerings by AI companies are capturing the attention of Wall Street. Anthropic on Monday made a significant move towards its initial public offering. Rival OpenAI is anticipated to submit its application for an initial public offering. Elon Musk’s SpaceX, having submitted its IPO application in May, is expected to commence trading on the stock market this month. As firms compete for supremacy in artificial intelligence, financial markets anticipate that the substantial expansion of data centers will persist to support this technology. That is igniting vigorous rallies in firms beyond merely Big Tech: Some of the most sought-after stocks this year have been the memory chip manufacturers and data storage enterprises positioned to gain from the AI infrastructure expansion. Big Tech’s substantial investment in AI infrastructure, along with upcoming IPOs such as Anthropic’s, is generating favourable conditions for firms engaged in the supply chain. It’s boosting shares in companies like SanDisk, which is up more than 600% year-to-date. SanDisk is a company that focuses on memory storage solutions.
Micron Technology, Seagate Technology, and Western Digital have all soared more than 200% this year. Micron manufactures memory chips. Seagate and Western Digital are both prominent players in the data storage sector. The S&P 500, in comparison, has experienced an increase of 11% thus far this year. On Monday, Alphabet announced its intent to raise $80 billion in equity, including $10 billion from Berkshire Hathaway, to finance the expansion of AI infrastructure. The plan highlights the favourable conditions for firms within the data center supply chain. AI systems necessitate substantial memory and storage capacities to operate effectively and manage extensive volumes of data. Demand for chips and memory is so intense that it is outstripping supply, exacerbating concerns about shortages. That imbalance is enabling chip makers and storage companies to increase their prices, thereby enhancing their earnings and growth projections, according to Angelo Zino. “Certain pockets of the supply chain are experiencing notable bottlenecks,” Zino stated. “The segments of the market experiencing the most significant bottlenecks simultaneously present the highest potential for price appreciation.” It is attracting the attention of both institutional investors and individual traders. Micron was the second-most traded stock on the trading platform Interactive Brokers in the five trading sessions leading up to May 26, following Nvidia. SanDisk ranked sixth.
Roundhill launched an exchange-traded fund in April focused on memory stocks, referencing a type of memory technology. The DRAM ETF experienced a significant increase of 61% in May. Analysts anticipate that the AI buildout will significantly alter revenue streams for firms such as SanDisk and Micron. SanDisk shares, leading the pack, have increased by over 4,500% in the past 12 months. SanDisk separated from Western Digital in February 2025. Analysts at Citi on May 19 increased their price target for SanDisk from $1,300 to $2,025. The stock closed at $1,761 on Monday, reflecting a 27% increase since Citi upgraded its target two weeks prior. SanDisk has seized market opportunities by establishing business deals with transparent pricing and financial guarantees backed by prepayments, noted Tom O’Malley. Micron’s valuation stood at slightly more than $100 billion a year prior. The memory chip company exceeded $1 trillion in market value last week, surpassing the valuation of JPMorgan Chase. Micron shares have experienced an increase of nearly 1,000% over the past 12 months. Micron’s market value surged from $500 billion to $1 trillion in under 50 trading days, marking a remarkable achievement. Nvidia, in comparison, required nearly 500 trading days to achieve a doubling from $500 billion to $1 trillion.
UBS analysts boosted Micron’s price target from $535 to $1,625 on May 26. The upgrade ignited a robust rally, with Micron shares experiencing a 19% increase, marking their most significant day since 2008. Analysts noted that long-term business agreements from the data center buildout should boost Micron’s earnings. Meanwhile, Seagate and Western Digital persist in capitalising on the robust demand for data storage. O’Malley at Barclays has increased his price target for Western Digital from $450 to $620. The stock is just under $550, soaring over 950% in the last year. It is not solely the United States that is witnessing a memory boom driven by AI; South Korea’s chipmaker SK Hynix has recently exceeded a market value of $1 trillion. Samsung Electronics accomplished this milestone in May. Both firms are part of Roundhill’s DRAM ETF. Zino stated that impressive earnings have validated the soaring rally. Stocks remain relatively inexpensive, according to Rob Thummel. SanDisk has performed well, but the demand for memory products will surge to support AI application development, Thummel noted.