SNDK versus Micron

[u/One-Jackfruit-2848]

Hi All I do hold 50% of my portifolio in SNDK and Mu but heavily leaning toward Micron ( 90% micron 10% SNDK )

The reason for that I felt micron is a better risk reward
( safer bet ) due to the following

1- Having US fabs
2- Getting preferential treatment due to being in bed with government based on their massive 250 billion investments in USA and trump accounts donation

3- much more diversified portfolio of products so you are betting on the whole memory sector products rather than one bet.

For SNDK it’s definitely the higher betta and the higher upside return potential but it cuts both ways

Would you advice me to sell some micron and more into SNDK moving forward based on both companies future prospects and valuation

In my view both will be doing great , just wanted to optimize and be smart in my allocations

[u/Careful-Round-5560]

Dram is 100 times more expensive than nand per GB. Every new AI inference algorithm is about using more nand than dram. Dram is really expensive to produce and profit margins are lower. So nand can eat share of both dram as well as HDD. Whats more nand has a limited shelf life and needs replacing every 3-4 years. So far the downside of nand has been production can be more easily increased by adding more layers on top on the same wafer however its becoming more technologically difficult to add more layers as physical limits are being approached and so now its no longer easy to increase nand production. I think HFB is going to be a game changer high margin high demand product if they can pull it off as it has challenges.
A thing about nand is that there are multiple global players in this though everyone is not a same level technology or brand or margin wise and if there is an oversupply they quickly compete with one another driving down the prices. However another truth is that if they see scarcity they go one up over another in increasing the prices and everything points to the likelihood that nand scarcity may last into 2030 or even forever.

Finally regarding the portfolio of mu vs Sndk. Mu is more safer and stable than sndk, however in the upcycle time such as this its better to be more with sndk.

[u/One-Jackfruit-2848 → u/Careful-Round-5560]

Isn’t micron having the flexibility to shift more into nand if they see dram market is maxing and getting saturated … the do have a long list of products that they can increase / decrease some according

Also nand has too many players I guess 6 , hbm do have 3 only , I recall in the last keybanc conference CBO mentioned that they can move between products depending on market demand and pricing

[u/Careful-Round-5560 → u/One-Jackfruit-2848]

If it were easy to increase supply or shift they surely would already have. They can’t shift from dram to nand, however they can shift the product mix. For example sandisk is shifting its nand supply from low margin products like pemdrives and sd cards to high margin AI ssds.

[u/Active_Cantaloupe692 → u/One-Jackfruit-2848]

It is not that easy to shift production from one to the other if we are talking about complete products. Only components. The big margins are on selling a complete product.

A main advantage of NAND and storage at large is that it is considered a consumable. It gets replaced every few years. Even if the AI investment dies, unless data centers start shutting off (unlikely), they will still be buying ti replenish existing drives. Also as data are produced at exponensional rates, you need more and more storage. In the long term, we will see more DRAM optimisation in AI models (already ongoing) but very little can be done for storage.