This chipmaker 'can be a leader' that sparks gains in other semiconductor stocks, Cramer says

Micron Technology (MU) is a stock to watch within the semiconductor industry, CNBC's Jim Cramer said Monday.

"This stock can be a leader. There are others that can go with it," Cramer said on "Squawk on the Street." "For instance, historically, you might find that AMD will go with it because there's a big PC component," he said, referring to Advanced Micro Devices (AMD), which designs central processors for computers. Micron makes memory chips that also go into computers.

Cramer's comments Monday came after Deutsche Bank analysts upgraded Micron shares to buy, from hold. The firm also raised its price target to $85 per share, up from $65, implying more than 20% upside from where the stock closed Friday, at $69.88 per share. Micron stock climbed modestly in Monday trading.

Micron has been grappling with inventory gluts and weaker demand in key end markets, such as PCs and smartphones, but there have been signs of improvement lately.

In its upgrade, Deutsche Bank argued that "the worst of the downcycle" is now behind Micron, and said it's seeing encouraging signs on pricing for a type of memory chips called DRAM amid increasing demand for artificial intelligence servers.  

Cramer suggested that if the conditions Deutsche Bank analysts describe are correct, "this group is a leadership group."

"It's just been kind of weak for weeks now," he said, alluding to the fact the PHLX Semiconductor index has fallen each of the past two weeks. "Maybe Micron sparks a little bit of life."

Nvidia (NVDA), the leading AI chipmaker, and Broadcom (AVGO) are the two semiconductor companies owned by Cramer's Charitable Trust, the portfolio used by the CNBC Investing Club.

The chip makers are part of the Information Technology sector, which accounts for more than 27% of the overall S&P 500 index. The Club just did an in-depth report on all 11 sectors of the market, the industries within those sectors, and where the 35 stocks owned by Cramer's Trust fit in.