Shares of Micron Technology (MU - Get Report)  were up over 9% Thursday after the company beat revenue and profit expectations for its fiscal second-quarter report on Wednesday evening. The nice surprise should lead to a revaluation of several other semiconductor names.

The initial response, indeed, was broad-based on Thursday, as shares of bellwether stocks such as Intel (INTC - Get Report) and Texas Instruments (TXN - Get Report) and Applied Materials (AMAT - Get Report) all rose. Some of the hotter stocks in semis, such as Nvidia (NVDA - Get Report) and Advanced Micro Devices (AMD - Get Report) , reported even sharper gains on Thursday. And equipment maker Lam Research (LRCX - Get Report) , which benefits from sales of tools to make memory chips, notched an almost 5% gain on Thursday. 

Encouraging words from Micron management should convince investors the worst is soon to be over in chip-land. 

Although the forecast from the company for the current quarter is below consensus, CFO David Zinsner said shipments of its DRAM memory chips should resume their quarter-to-quarter growth this quarter, while NAND flash memory chip shipments should pick up in the subsequent quarter. In other words, the back half of this calendar year is when things will be back to the races for Micron, and the stock's jump reflects that.

The fact is, Micron and its peers are still trading at multiples that reflect a prolonged downturn that doesn't appear to be in the cards. 

Consider that the average future price-to-earnings multiples for Intel, TI, Applied, Lam, and three other great chip names -- Qualcomm (QCOM - Get Report) , Maxim Integrated Products (MXIM - Get Report) and Cypress Semiconductor (CY - Get Report)  -- is just 14.5 times. That's a steal of a deal in a tech landscape dominated by multiples like Microsoft's (MSFT - Get Report) 23.8 times forward earnings, or the sky-high multiples of software names such as Veeva Systems (VEEV - Get Report) , trading at 57 times, or The Trade Desk (TTD - Get Report) , trading at 63 times. 

These mainstay semi names are also cheaper than the ultra-hot chip stocks mentioned above, Nvidia and AMD, which both fetch 28 times forward earnings. And they're also cheaper than the 15.3 average forward multiple of the S&P 500. 

Nvidia and AMD both have higher growth rates than the others, but Intel and TI are income names, generating decent growth and paying out most of their cash flow in the form of dividends and stock repurchases. 

Meantime, Micron trades at a pitiful ten times its forward earnings for next fiscal year. Micron always fetches a lower multiple, in good times and bad, reflecting the commodity nature of the chip markets that it plays in.

That said, the company is making a sincere effort to sell products that are less of a commodity. CEO Sanjy Mehrotra noted on Wednesday evening's call with analysts that two-thirds of the NAND flash chips the company ships are now of the "high-value" variety, meaning that they're more complex, perform at a higher level and command higher margins. That's up from 55% in the first half of last year. (More detail on Micron's results can be found in its earnings release, and in its investor presentation.)

TheStreet's Bret Kenwell made a nice technical argument on Thursday for Micron's stock, but you can also focus on the simple fact that its stock is just real cheap.

Ten times forward earnings actually reflects estimates that are still relatively depressed for the company's earnings. That suggests that if CFO Zinsner is right, estimates have to go higher to close that earnings multiple to something more closely resembling the six or seven times earnings the stock historically carries.

All the sources of demand that have been identified in recent years by Micron and peers clearly remain in play. Data centers continue to be built to the sky by customers such as Alphabet's Google (GOOGL - Get Report) and Amazon's (AMZN - Get Report) AWS, simply because more data from the world needs to be analyzed in machine learning systems. And more and more of that data is gathered by sensors embedded in products in the real world, which themselves carry embedded microprocessors, analog chips and memory to do local data collection and processing. 

And all that will continue to require tools from Lam and Applied, which each have a lock on their respective areas of excellence. 

What hit Micron's stock in 2018, and that of many of its peers, was the sudden build-up of supply in its industry. Chips are still driven by supply, more than demand, something the bulls on Micron didn't want to accept a year ago. Having taken the blows from that glut, Micron and others can look forward to a tightening of supply, which will allow those sources of demand mentioned above to take the spotlight once again. 

Nvidia, Lam, Microsoft, Alphabet and Amazon are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells these stocks? Learn more now.

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Tiernan Ray neither trades nor owns shares of any stocks discussed in this article.