Micron Technology, Inc. (MU) climbed 4.46% to $34.16 after an analyst from BMO Capital Markets reversed his bearish stance and upgraded the semiconductor company to outperform from market perform.

In a note to investors, analyst Ambrish Srivastava wrote that "while fundamentals will likely get worse before they get better, we believe the shares have bottomed out and are hence upgrading the stock to Outperform from Market Perform." 

"We are also raising our target price to $50 from $32," Srivastava added. "Our reversal in thinking is driven by a combination of the following two factors - valuation and a structurally more profitable company, which will lead to FCF generation even under rather dire scenarios that we are modeling for."

The Boise, Idaho-based company offers memory and storage technologies, including DRAM, NAND, NOR Flash, and 3D XPoint memory under the Micron, Crucial, and Ballistix brands, as well as private labels.

Regarding DRAM, Srivastava said Micron had a lot of ground to cover compared with its larger rivals Samsung and SK Hynix, and, "the company has done just that."

Compared with the prior peak, Srivastava said he estimated that "Micron's cost structure is better by about $2 billion." The company has also managed to close the gap in margins compared with the larger rivals, Srivastava said.

"We estimate the gap to be lower from 9 percentage points to about 6 points," Srivastava wrote. "Micron has been able to reduce its cost faster than the rivals."