Goldman Sachs says this chip stock will surge this year

Kai Pfaffenbach | Reuters

Investors should buy Micron Technology shares because the company's earnings this year will come in significantly above current expectations, according to Goldman Sachs, which upgraded the chipmaker to buy from neutral.

"We see a tactical opportunity in MU and upgrade the stock," analyst Mark Delaney wrote in a note to clients Tuesday. We forecast "upside to CY17E Street EPS driven by memory price increases in February and March (led by strength in server DRAM [dynamic random-access memory] and despite slower trends in handset units)."

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