The crucial DRAM memory stock sector, vital for AI infrastructure, is facing a market downturn despite record profits from companies like Samsung. This period of weakness, following an earlier rally, is being eyed by Jay Woods of Freedom Capital Markets as a significant buying opportunity.
Woods suggests focusing on the DTRB ETF and individual stocks like Micron (MU), which has seen substantial gains this year and is now consolidating, presenting a promising entry point with clear upside targets.
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The memory stock sector, a crucial component for AI infrastructure, is experiencing a significant downturn. Despite top companies within the DRAM space reporting record profits and substantial backlogs, the market's reaction has been muted. Samsung's recent record third-quarter earnings, for instance, were met with a shrug from Wall Street. This current malaise, following a strong rally earlier in the year, presents a compelling buying opportunity, according to Jay Woods, Chief Market Strategist at Freedom Capital Markets.
Woods points to the Direxion Data Robotics, Automation and AI ETF (DTRB), which tracks DRAM, as an indicator. While the ETF has limited price history since its launch on April 2nd, its shares surged as much as 211% before retreating and forming a base. Analyzing the price action using Anchored Volume-Weighted Average Price (AVWAP) levels – anchored to the initial pricing, all-time high, and recent low – reveals bullish signals. The current price is holding around the all-time high AVWAP, the inception AVWAP, and the 50-day moving average, indicating strong support.
Woods recommends initiating or adding to positions at these levels, using the AVWAP from recent lows around $53 as a stop-loss. He anticipates upside targets of $63, with the potential to reach the low $70s if the $63 mark is breached.
Delving deeper into the ETF's components, Woods highlights Micron (MU) as a particularly attractive stock. Micron has been a standout performer in the S&P 500 this year, with shares up over 270% in 2026. Although the stock has traded sideways since May, Woods sees its current consolidation as a prime entry point for investors looking for solid risk/reward setups within the memory sector.
