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Micron Technology and Comfort Systems shares have outperformed Nvidia and Palantir this year, driven by different parts of the artificial intelligence supply chain—memory chips for data centers and the mechanical and electrical systems needed to run them.
Year to date, Nvidia shares are up 8%, while Palantir Technologies shares are down 18%. By contrast, Micron Technology is up 59% year to date, and Comfort Systems has also benefited from strong demand tied to AI infrastructure buildouts.
Micron is a semiconductor company that develops memory chips and storage solutions for personal computers, mobile devices, data center servers, and automotive systems. It is the third-largest manufacturer of DRAM memory products, including HBM (high-bandwidth memory), and NAND flash memory products.
The construction of AI data centers has increased demand for memory chips, contributing to an unprecedented supply shortage that has pushed prices sharply higher. DRAM and NAND contract prices have increased roughly sevenfold over the past year, according to The Wall Street Journal. Many analysts expect memory chips to remain in short supply through 2028, if not longer.
Micron reported exceptional financial results in the second quarter of fiscal 2026, which ended in February. Revenue increased 196% to $23.8 billion. Gross margin expanded 18 percentage points. Non-GAAP net income soared 682% to $12.20 per diluted share. CEO Sanjay Mehrotra said, “AI hasn't just increased demand for memory, it has fundamentally recast memory as a defining strategic asset in the AI era.”
One caveat is that the memory chip industry typically operates on a boom-and-bust cycle. The current shortage is expected to eventually turn into a supply glut as chipmakers increase production capacity, which would likely pressure memory prices lower and could reduce Micron’s earnings.
Wall Street expects Micron’s earnings to increase at 75% annually through fiscal 2028 (ending in August). On that basis, the current valuation of 20 times earnings is viewed by many analysts as relatively inexpensive. The median target of $550 per share implies 21% upside from a current share price of $455.
Comfort Systems USA provides mechanical and electrical services to commercial, industrial, and institutional buildings. The company benefits from scale, with more than 50 subsidiaries across 190 locations. Its focus on constructing mechanical and electrical systems as modular components at off-site facilities is designed to reduce time and cost versus on-site construction.
For AI data centers, Comfort Systems supplies air conditioning and specialized immersion cooling systems to manage the extreme heat generated by GPUs. It also builds products for semiconductor manufacturers, including clean room ventilation and climate control systems required to meet strict filtration, temperature, and humidity requirements.
Comfort Systems reported strong fourth-quarter results, supported by especially high demand from technology-sector customers. Revenue increased 41% to $2.6 billion, and net income rose 129% to $9.37 per diluted share. Revenue backlog doubled to $12 billion, indicating contracted sales not yet recognized and pointing to continued growth momentum.
Wall Street estimates Comfort Systems’ earnings will increase at 34% annually over the next three years. Against that projection, the current valuation of 57 times earnings is described as tolerable, though not cheap. Most analysts view the stock as roughly fairly valued at its current price. The median target of $1,710 per share implies 4% upside from a current share price of $1,650.
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