Investor attention is focused on Micron’s earnings report as concerns over AI-related valuations and elevated expectations contribute to volatility across technology stocks. Recent selling pressure has highlighted how sensitive the sector remains to policy developments and shifts in sentiment.
BNN Bloomberg spoke with Kyle Taylor, wealth advisor and portfolio manager at Tridelta Private Wealth, who said strong demand for AI memory chips continues to support the sector, but cautioned that investors should focus on diversification, valuation discipline and long-term positioning as the cycle matures.
Key Takeaways
- Micron’s earnings report is being closely watched as investors look for confirmation that AI-related demand remains strong enough to support current valuations.
- Spending on memory chips has surged as AI infrastructure buildouts accelerate, making memory suppliers key beneficiaries of the technology boom.
- Expectations for AI-related companies remain elevated, increasing the risk of sharp stock-price reactions to earnings results, guidance or policy developments.
- Emerging Chinese competitors could gradually narrow supply shortages in memory chips, although industry forecasts suggest tight conditions may persist until at least 2028.
- Investors may benefit from seeking broader diversification and focusing on valuation rather than relying heavily on a small group of momentum-driven technology stocks.
Read the full transcript below:
ROGER: Markets appear to be steadying after AI-bubble fears prompted a two-day slide in tech shares. Shares of Micron are trending higher after slumping 13 per cent yesterday. The memory-chip maker is due to report earnings after today’s closing bell, and investors are keeping a close eye on the results. Let’s get perspective now from Kyle Taylor, wealth advisor and portfolio manager at Tridelta Private Wealth. Kyle, thanks, as always, for joining us.
KYLE: Thank you.
ROGER: Okay, Micron, everybody’s watching it. What are you looking for, particularly on this one?
KYLE: Well, I think memory has really been the story of 2026 when it comes to these AI stocks, as it’s been necessary for the AI infrastructure buildout. To give you a bit of perspective on how vital these memory stocks have been, spending on memory within the semiconductor market exceeded 50 per cent this year. Around this time last year, it was about 22 per cent. So it’s been an important part of the rally, and the profits we’ve seen this year from Micron and some of its competitors, like SanDisk and SK, have been real. That’s really what’s helped support stock prices into the summer.
Obviously, yesterday we got some news out of South Korea, and that helped trigger some of the price shock in North America and elsewhere. That news was regarding political proposals around taxing AI companies. If the AI market is fragile enough to be disrupted by something like that, then I think prices were due for some sort of correction. But it’s good to see that there’s been some steadying today.
ROGER: All right. And just going back to Micron for a second, is there anything they could do that won’t leave investors saying it’s not enough? It feels like when it comes to tech, nobody’s ever satisfied, no matter how good the numbers are.
KYLE: Well, I’ll tell you that six months ago I would have said I loved this stock. Today, it’s more a stock that I tolerate, and it’s something that we’ve been selectively trimming back to keep the position sizing reasonable.
Most analyst targets have the stock trading somewhere between $1,200 and $1,500 by the end of this year. Expectations are exceedingly high going into these earnings. What I think investors will be paying the most attention to are those long-term contracts with customers around their products. That was something we heard a little bit about earlier this week with a deal signed with Anthropic.
Customers have really already priced those longer-term contracts into the stock price. So if there’s any negative news on that front, or people don’t like what they’re hearing, that could potentially move the stock one way or the other.
Credit to the management team, they’ve done really well in helping add visibility into their longer-term profitability and helping ease some of the anxieties around the cyclicality of chips as a whole.
ROGER: Is there competition coming on the horizon? Is China playing catch-up?
KYLE: Yeah, certainly. One of the things that has really helped the memory stocks has been the fact that there hasn’t been enough supply to meet demand from the hyperscalers building these data centres.
One of the things we’re seeing out of China is that there are up-and-coming competitors looking to help absorb some of that supply. Expectations don’t really have that levelling off until somewhere around 2028. I will say that timeline keeps getting pushed further into the future. A year ago, it was 2027. Today, it’s more 2028.
A lot of that has to do with the opportunity for Micron, SK and SanDisk to entrench themselves in the supply chains of the customers they’re servicing. They continue to enjoy really strong pricing power until then.
ROGER: All right. And you mentioned the concerns coming out of South Korea. Should we be concerned overall, from a bigger-picture perspective, about AI?
KYLE: Well, there have already been rumblings in the U.S. around taxing AI companies more heavily. I think the Trump administration is more on the side of taking an equity stake, similar to what they did with Intel, for example.
Again, if the market is fragile enough to be disrupted by a South Korean headline around a tax proposal, that’s not necessarily something you want to see. But I also think it was more about the fact that there have been significant gains for investors, and perhaps it was an opportunity for some people to take money off the table.
What we’re seeing is that this continues to be a momentum market. Because it is so narrow as a whole, and because of the reliance on AI companies, there are still opportunities to rotate portfolios toward less appreciated areas of the market and seek real diversification that you’re not getting through passive indexes.
ROGER: Okay, and I want to get to one stock you’ve got your eye on: Paychex.
KYLE: Yeah, so Paychex reported earnings this morning. They’re another topical name, and I think you can really lump them in with the software selloff from earlier this year.
Sentiment has continued to be quite negative around the name despite fairly solid earnings. Today they’re trading around their lowest valuation in the last 10 years, roughly 16 to 17 times forward earnings, with earnings estimates still trending higher.
I think we’re seeing a bit of a pre-market selloff in the stock this morning, but for us it’s a name we’re willing to be a little more patient with given the valuation and the fact you’re getting nearly a five per cent dividend.
To back up a little bit, Paychex is a provider of payroll, compliance and human-resources management solutions. They typically target private companies with fewer than 20 employees, but they’re in the midst of integrating Paycor, an acquisition from last year that has expanded their reach into more mid-sized businesses.
One of the things investors are still waiting on is how AI may disrupt their business. But to me, many of their services are so deeply ingrained in the businesses they serve that switching costs are quite high.
These are services that businesses rely on and can’t necessarily abandon in favour of AI until it’s proven and tested. In the meantime, it’s an opportunity for a company like Paychex to integrate those services itself.
ROGER: Okay, we’ve got to wrap it up there, Kyle. Thanks, as always, for joining us.
KYLE: Thank you, Roger.
ROGER: Kyle Taylor, wealth advisor and portfolio manager at Tridelta Private Wealth.
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This BNN Bloomberg summary and transcript of the June 24, 2026 interview with Kyle Taylor are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
