Should You Buy Micron Stock Instead of Nvidia Stock? | MU Stock vs. NVDA Stock

Parkev Tatevosian, CFA•Jul 31, 2026

Summary

Parkev provides a comparative analysis of Nvidia and Micron, evaluating their revenue trends, operating margins, and Return on Invested Capital (ROIC). Parkev notes that both companies are experiencing significant growth, but the source of that growth differs; Nvidia's revenue is driven by unit growth and innovation, while Micron's recent revenue quadrupling is largely due to massive price spikes caused by supply shortages. Parkev emphasizes that Nvidia's business model is more sustainable because it focuses on design and software differentiation while outsourcing manufacturing, unlike Micron's capital-intensive approach of owning its own factories.

NVDA: Parkev highlights Nvidia's massive revenue surge from under $5 billion in 2017 to $253 billion on a trailing 12-month basis. Parkev argues that Nvidia's asset-light model allows for a phenomenal ROIC of 112%, which is significantly higher than its peers. Using a discounted cash flow analysis, Parkev calculates a fair value of $305 per share for Nvidia, suggesting it is highly undervalued compared to its current market price of $197.

MU: Parkev observes that Micron is currently enjoying 80% operating margins due to high average selling prices, though Parkev warns these levels are likely unsustainable long-term as they depend on market imbalances. Parkev points out that Micron is not the leader in high-bandwidth memory technology, which gives it a weaker competitive position than Nvidia. Despite these concerns, Parkev calculates a DCF fair value of $1,487 per share for Micron, indicating it is fundamentally cheap relative to its market price of $820.

Parkev concludes that while both stocks are excellent opportunities and rated as a buy, Nvidia is the preferred choice for a portfolio. Parkev mentions owning Nvidia personally and ranking it among the top 12 stocks to buy right now, whereas Micron is on Parkev's watchlist for potential future addition.

Mentioned Stocks

Sentiment: BUYAction: RECOMMENDED

Reasoning: Parkev rates Micron as a buy because it is fundamentally undervalued with a forward P/E of 5.3 and a DCF fair value of $1,487 compared to its current price of $820. However, Parkev notes that its current high profit margins are less sustainable than Nvidia's because they are driven by temporary pricing spikes and supply shortages rather than long-term competitive differentiation.

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NVDA

Sentiment: BUYAction: RECOMMENDED

Reasoning: Parkev rates Nvidia as a buy due to its sustainable revenue growth and superior asset-light business model. Parkev highlights its high Return on Invested Capital of 112% and strong competitive moat through software integration. Furthermore, Parkev calculates a fair value of $305 per share, which is significantly above the current market price of $197 mentioned in the video.

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