Morgan Stanley has shifted to a bullish view on memory semiconductor stocks, arguing that the sector's recent sell-off has run through its harshest phase and now offers a tactical re-entry point. In its Asia technology report "Memory—A Small Bend," published on the 6th, the bank said "the steepest correction ever seen in the memory industry appears to be over" and described current valuations as attractive after having warned just last month of a near-term pullback tied to peak DRAM pricing momentum and crowded positioning. The new stance frames the downturn as part of a maturing cycle rather than a structural slump. The call carries added market weight because it came from analyst Sean Kim, whose 2021 report "Memory, Winter is Coming" correctly anticipated an industry slowdown and earned him the nickname "Semiconductor Grim Reaper." Morgan Stanley's latest thesis centers on AI-related demand for HBM (High Bandwidth Memory) and on shareholder return measures such as buybacks. The bank said the market focus is moving away from pure price-cycle trading and toward capital returns, including share repurchases, free cash flow and LTAs (long-term supply agreements). Morgan Stanley still flagged risks. It warned that memory price gains could begin to slow in the fourth quarter of this year, while rising inventories and supply could cap further earnings-estimate upgrades. On stock-specific calls, the bank kept its target prices at 2.6 million won for SK Hynix and 375,000 won for Samsung Electronics, levels it said imply more than 60% upside from current prices. It also lifted its fiscal 2026 EPS estimate for SK Hynix by 13% but cut Samsung Electronics' by 10%, signaling different earnings paths. Citigroup struck a more cautious tone on Micron, lowering its price target from $1,400 to $1,150 while keeping a Buy rating. Its analysts expect DRAM and NAND price increases to continue but ease on a quarterly basis over the next four quarters, peaking in the second quarter of next year. They forecast DRAM prices will fall 3% in the second half of 2027 versus the first half, while NAND prices will decline 5%, a downgrade from their prior expectation for flat DRAM prices. Citigroup also reduced its fiscal 2027 and 2028 EPS estimates for Micron by 1% and 2%. Micron shares have been volatile since July, falling from above $1,000 to as low as $740 before recovering to around $900. Taken together, the two banks' views suggest the memory chip market remains in a near-term correction but could regain momentum over the medium to long term if AI demand stays strong, though earnings improvement may come more gradually as supply rises and pricing momentum cools.