Micron vs. Sandisk: 1 Artificial Intelligence (AI) Memory Stock Is Clearly the Better Buy Today

Micron (NASDAQ: MU) and Sandisk (NASDAQ: SNDK) have had an incredible 2026, with Sandisk stock rising more than 520% and Micron increasing by about 225% (as of Aug. 28). That ranks Sandisk as the top-performing S&P 500 (SNPINDEX: ^GSPC) stock, and Micron as the fourth-best for 2026. That's an impressive run, but there are still four months left in 2026 and a lot could happen.

Between the two, is there a better stock to buy? Let's take a look at which one makes the most sense because I think there's a clear winner.

Micron's business is broader

Micron and Sandisk are both memory chip fabricators. There are two primary types of memory: NAND and DRAM. DRAM memory is utilized by computing units for rapid information access. Micron is the only company of the two that makes DRAM. Both companies make NAND, which is used for long-term data storage. In a data center, the most common use is in solid-state drives (SSDs). Regardless of which type of memory you're talking about, both companies are beyond sold out.

With little new supply available and rising demand, the prices on memory chips have skyrocketed. This has allowed both Micron and Sandisk to make a fortune on their products, but they are doing their parts to alleviate the shortage. Sandisk recently announced a third fabrication facility, and Micron has several production facilities under construction. However, it's going to be some time before those facilities are up and running. Most of Micron's facilities won't be running until mid-2027 and Sandisk's facility won't be online until after that.

This could prolong the memory chip shortage, which may be bad news for consumers and AI hyperscalers, but it's great news for these two companies. By investing in these stocks, you can also profit from these soaring memory chip prices.

But of the two, Micron is by far the better business. Micron saw the writing on the wall and started building new production facilities a while back. Sandisk only recently decided to start building new facilities. Furthermore, Micron operates on both sides of the memory chip market. So, if one side's supply shortage is alleviated, it can still benefit from lofty prices on the other one. With Sandisk, it's a coin flip whether the NAND industry sees the supply constraints alleviated first.

Winner: Micron

Both companies are growing at a rapid pace

During their most recent quarters, revenue at both companies grew rapidly.

MU Revenue (Quarterly YoY Growth) data by YCharts

Micron reports results on Sept. 30, and Wall Street analysts on average expect 349% growth. However, Micron has been blowing estimates out of the water for a while now, mainly because surging memory chip prices make projections difficult. For example, in Q3, Micron forecast revenue of $33.5 billion. Then, it turned around and delivered $41.5 billion. I'm not sure whether Micron can deliver that kind of beat again, but if it can, it will easily secure itself as the faster-growing of the two.

Regardless, it's hard to declare a winner here because revenue at both is rising at an annual rate of 350% or more, which is simply incredible.

Winner: Tie

Micron is the cheaper stock

Sandisk's fiscal year ended in June, while Micron's ends in August. As a result, valuing the companies on 2027 earnings projections is the best tool investors have. Micron trades for about 6 times fiscal 2027 earnings estimates.

MU PE Ratio (Forward 1y) data by YCharts

Sandisk stock is slightly more expensive, at almost 7 times forward earnings.

SNDK PE Ratio (Forward) data by YCharts

These are two dirt cheap price tags, but that's because the market is unsure about the future of the memory chip market cycle. If prices stay elevated, these two are fantastic investments and are worth buying now. But if prices come crashing down in 2028 after more production facilities are up and running, they may not be as compelling. Regardless, I think it's hard to give a win to either stock once again because they're still both cheap.

Winner: Tie

Micron's win is bigger than it appears

Micron ends up being the better stock solely due to its more diverse business. Micron's exposure to both sides of the chip market, plus its foresight to build more production facilities so it can benefit from surging demand places it in a better position to benefit over the long haul. It's clearly better run, and that goes a long way in investing.

Keithen Drury has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool has a disclosure policy.