Val Zlatev

Memory stocks trade at 6-7x forward earnings because the market expects a sharp memory price decline within 6-9 months. That downturn is unlikely because supply is physically capped: semiconductor equipment makers cannot grow shipments more than 30% per year, and memory producers are older, cautious, and underinvested. The AI-driven storage explosion (reasoning models, agents, context windows) has pushed memory prices up 4-5x, and they are still rising 30% quarter-on-quarter, supporting peak earnings for longer than the market believes.

Memory stocks trade at 6-7x forward earnings because the market expects a sharp memory price decline within 6-9 months. That downturn is unlikely because supply is physically capped: semiconductor equipment makers cannot grow shipments more than 30% per year, and memory producers are older, cautious, and underinvested. The AI-driven storage explosion (reasoning models, agents, context windows) has pushed memory prices up 4-5x, and they are still rising 30% quarter-on-quarter, supporting peak earnings for longer than the market believes.

Memory stocks trade at 6-7x forward earnings because the market expects a sharp memory price decline within 6-9 months. That downturn is unlikely because supply is physically capped: semiconductor equipment makers cannot grow shipments more than 30% per year, and memory producers are older, cautious, and underinvested. The AI-driven storage explosion (reasoning models, agents, context windows) has pushed memory prices up 4-5x, and they are still rising 30% quarter-on-quarter, supporting peak earnings for longer than the market believes.