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Feb 18
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LONG
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Mandeep Singh
Senior Analyst, Bloomberg Intelligence
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"CapEx increase is going to memory, which has really gone up so much because of the shortages... how much is for component increases right now." While there is uncertainty about the ROI for companies *spending* the CapEx, the destination of that capital is clear: it is flowing into components with pricing power. Memory shortages are driving up costs, meaning memory producers are capturing the value of the increased spending. LONG the Memory Sector as the direct beneficiary of supply constraints and inflationary CapEx cycles. Resolution of supply chain shortages could soften pricing power; broader tech pullback could reduce overall CapEx budgets. |
Bloomberg Markets
Tech Stocks Bounce Back as AI Concerns Begin ...
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Feb 17
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LONG
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Deirdre Bosa
Anchor/Reporter, CNBC Tech Check
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There is a "global shortage" in memory chips with prices up "90% in a single quarter." Apple is reportedly in talks with Chinese chipmakers (MTK, CSMT) to fill the gap. When the world's largest buyer (Apple) is forced to seek alternative Chinese suppliers, it confirms a massive supply/demand imbalance. This pricing power directly benefits established memory manufacturers like Micron (MU). Long the Memory Sector and MU to capture the super-cycle in pricing. Overproduction in late 2026; faster-than-expected capacity expansion from Chinese competitors. |
CNBC
China's Lunar New Year tech showcase
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Feb 16
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LONG
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Neil Kaplan
Bloomberg Senior Strategist
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"It takes between three and five years to build a new memory fabrication plant... creating this bottleneck." Hynix states the situation will "get worse before it gets better." Basic supply and demand. Demand is exploding (AI chips use 10x memory) while supply is inelastic (3-5 year lag). This creates significant pricing power for pure-play memory producers who sell the commodity rather than the finished device. LONG. Structural scarcity benefits the upstream commodity producer. Global recession reducing demand for end-products (smartphones/PCs), which could offset AI demand. |
Bloomberg Markets
Musk, Cook Warn of Memory Chip Crisis as Dema...
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Feb 12
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LONG
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Kim Forrest
CIO, Bokeh Capital Partners
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There is concern about whether chipmakers can meet demand, but the memory market is an oligopoly with few players. Whether the market demands "Training Chips" (Nvidia) or "Inference Chips" (for running models), *both* require massive amounts of memory. Demand is agnostic to *which* AI chip wins. High demand + limited competition (Moat) = Bullish for memory makers (implies MU / SK HYNIX). Cyclical downturn in consumer electronics dampening non-AI demand. |
Bloomberg Markets
US House Defies Trump on Canada Tariffs | The...
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Feb 11
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LONG
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Stuart Kaiser
Head of US Equity Trading Strategy, Citi
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The market is punishing "Spenders" (Hyperscalers spending billions) and rewarding "Enablers." Investors want exposure to the companies selling the picks and shovels (Memory, Power Gen) rather than the companies burning cash on CapEx with uncertain ROI. LONG AI Infrastructure/Memory; AVOID Hyperscalers (Spenders). If AI power usage/chip demand undershoots, the trade collapses. |
Bloomberg Markets
Bloomberg Surveillance 02/11/2026
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Feb 10
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LONG
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Mark Newman
Senior Analyst, Bernstein
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"That's despite rising memory prices, which he says could drive iPhone prices up 15%... huge price increase from memory." This is a classic second-order trade. If Apple (the world's largest consumer electronics buyer) is being forced to raise retail prices by $150 specifically because memory components have become so expensive, it implies massive pricing power for the memory suppliers. Apple's cost headwind is Micron/Western Digital's margin expansion. Long the memory suppliers who are clearly dictating terms to OEMs. If Apple refuses to pay and cuts memory specs (lower GB per phone), demand for memory chips could soften. |
CNBC
Strong iPhone 17 cycle giving better than exp...
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