Micron vs. Palantir: Which AI Stock Is the Better Buy for 2026?

Micron Technology, Inc. MU tripled in 2025 by supplying essential memory for artificial intelligence (AI) infrastructure, while Palantir Technologies Inc. PLTR, a leading provider of AI-driven analytics software, saw its shares climb more than 100% in the same time period. The question now is: can both continue this momentum, and which stock is the better buy right now? Let’s see in detail –  The Case for Staying Bullish on Micron Stock The increase in demand for Micron’s high-bandwidth memory (HBM) chips has fueled its recent strong quarterly performance and remains a significant catalyst for sustained growth ahead. HBM chips are expected to stay in strong demand due to their short supply amid the rapid AI infrastructure expansion. HBM chips are most sought-after due to their fast data processing capabilities and lower power consumption. Micron projects fiscal second-quarter 2026 revenues between $18.3 billion and $19.1 billion, following fiscal first-quarter 2026 revenues of $13.64 billion, a 56.8% year-over-year increase, according to investors.micron.com. The company’s CEO, Sanjay Mehrotra, expressed strong optimism, noting that “our Q2 outlook reflects substantial records across revenue, gross margin, EPS, and free cash flow, and we anticipate our business performance to continue strengthening through fiscal 2026.” Micron generated a record cash flow of $3.9 billion in fiscal first-quarter 2026, giving the company adequate resources to drive growth initiatives. Its HBM chips reach customers beyond NVIDIA Corporation NVDA, including Advanced Micro Devices, Inc. AMD, ensuring stable demand even if NVIDIA’s edge diminishes (read more: Micron Has Tripled in 2025 - Still a Discounted Strong Buy). Key Factors Driving the Bullish Case for Palantir Both the U.S. government agencies and commercial customers are deploying Palantir’s Artificial Intelligence Platform (AIP) as it enables enterprises to seamlessly integrate and apply AI and large language models across their complex data environments.  Riding the momentum of AIP adoption, Palantir expects strong revenue growth from both U.S. government and commercial clients, with total fourth-quarter 2025 sales projected between $1.327-$1.331 billion, and full-year 2025 revenues between $4.396-$4.400 billion, as cited by investors.palantir.com. Palantir has already reported revenues of $1.18 billion in the third quarter of 2025, representing a 63% increase from the same period a year ago and an 18% sequential rise. Palantir’s CEO Alex C. Karp highlighted the company’s scalability, citing a Rule of 40 score of 114%, well above the typical 40% benchmark (read more: 1 AI & 1 Quantum Stock Beat NVIDIA in 2025, Promise More Gains Ahead). Micron or Palantir: Which AI Stock to Buy in 2026? While Micron’s shares are expected to climb northward, driven by strong HBM chip demand, record cash flow, and a strong customer base, Palantir’s shares could gain momentum, fueled by the growing popularity of AIP.  However, Palantir’s forward price-to-earnings (P/E) ratio of 172.08, versus the Internet-Software industry’s 32.42, indicates elevated market expectations, meaning the stock could witness a sharp price drop if growth slows down, making it a risky bet at this moment. Additionally, with revenues still heavily dependent on government contracts, any probable defense budget cut can constrain Palantir’s growth. Image Source: Zacks Investment ResearchOn the other hand, Micron’s forward P/E ratio of 10.78 is less than the Computer-Integrated Systems industry’s average of 18.2, positioning it as an attractive growth stock to buy now at a reasonable valuation. Image Source: Zacks Investment ResearchCurrently, Micron has a Zacks Rank #1 (Strong Buy), and Palantir has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here. Just Released: Zacks Top 10 Stocks for 2026Hurry – you can still get in early on our 10 top tickers for 2026. 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(PLTR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks