It’s a tough time to be a P/E evangelist on social media.

Chip stocks have become far cheaper in recent weeks as investors continue to worry about the sustainability of the artificial-intelligence buildout. But for investors who’ve pointed to the bargain-basement price-to-earnings ratios of stocks like Micron Technology and Nvidia, others haven’t been so kind.

The issue underscores a fundamental debate over earnings in an environment where AI investments could slow down, and that’s especially true of Micron’s stock, which has a P/E multiple that sits at 3.8 times estimates for earnings over the next 12 months. That makes Micron’s stocks one of the cheapest within the S&P 500, putting it third to last in the index on this metric.

For investors who believe AI-driven demand for memory will remain strong, “Micron is extremely cheap,” Wedbush analyst Matt Bryson told MarketWatch, because its power to raise prices and its revenues will continue to hold up.

The company is also preparing to return tons of cash to shareholders, as restrictions on share buybacks are due to lift next month.

But price-to-earnings multiples are based on two things. One, of course, is the stock’s price, which in Micron’s case has come down nearly 50% from peak levels achieved in June. The other is earnings expectations for the future.

Micron’s declining P/E multiple reflects concerns about the durability of the company’s earnings, especially given the memory-chip industry’s tendency to see big profit booms followed by busts.

The uncertainty “helps explain why traders are not willing to assign a higher multiple to the stock,” Jake Behan, the head of capital markets at Direxion, told MarketWatch.

For bears, or those with less confidence in Micron’s stock, the idea is that the prospect of a memory downturn is becoming more real, Hendi Susanto, a portfolio manager at Gabelli Funds, told MarketWatch. And following the U.S. midterm elections, in which anti-data-center sentiment became a top issue for politicians and voters across both parties, the market is wary about how long and strong demand for memory chips will be going forward, he added.

Wedbush’s Bryson noted, too, that if demand falls off for Micron’s memory chips, the company will have a problem not only shipping as many chips as expected, but also pricing them so high.

Granted, recent earnings reports have offered “a lot of positive data for the memory players, including high memory costs, supply constraints, multi-year agreements … and how memory costs in 2027 will impact end-products,” Susanto said in emailed comments.

Josh Kaplan, head of research and investment strategy at MarketVector Indexes, said that whether Micron’s valuation is cheap or not depends on whether still investors view memory as a cyclical business. Memory companies have been locking in long-term agreements in order to spread the current pricing environment out over a longer period.

“To think that this time is different is a hope that people who bought at the top will cling on to, and they are likely the ones who will keep buying the dip on the way down,” Kaplan said.

Memory-chip sales are currently concentrated among a handful of buyers, he said, pointing to large cloud service providers looking to build out AI infrastructure. Consumer electronics need memory, too, but AI-driven demand has led to a painful shortage for that sector.

“Micron’s ability to sustain its earnings growth is based on the assumption that hyperscalers have an infinite appetite for investment and that they are willing to see their share prices crater and bond yields soar indefinitely,” Kaplan said in emailed comments.

As previous major technology and infrastructure buildouts have shown, however, there will be a time in this cycle when either the infrastructure gets built and demand declines, or large cloud providers have to pull back to appease stakeholders who are upset about the financial strain of AI investments, he said.

Additionally, memory is a historically commoditized business. Therefore, as memory incumbents look to add capacity to meet soaring demand, competition is rising, including from Chinese memory makers. The increase in supply will eventually drive down the cost of memory, Kaplan said, and lead to erosion of earnings or gross margin, which is a measure of profitability.

“Micron being ‘cheap’ assumes that the E in the P/E is right,” Kaplan said.

And while Micron’s stock is indeed cheaper than some retail stocks like Costco’s, which trades at around 46 times estimated earnings for the next 12 months, Kaplan said those comparisons aren’t exactly fair. Consumer-staples companies have low earnings variability. And Costco’s “risk of permanent capital impairment is greatly diminished,” he said.

However, to Ted Mortonson, a managing director at Baird, memory has transitioned from being a cyclical industry.

Mortonson finds Micron attractive both because of its role as a U.S. supplier and because “it trades in the U.S. versus the casino of the KOSPI,” he said, referring to South Korea’s benchmark stock market index that includes Micron’s main rivals SK Hynix and Samsung Electronics.

Like Susanto, Mortonson is optimistic on Micron’s long-term agreements with customers that allow it “tremendous visibility” through 2029.

“That should affect the multiple in a positive way, as memory has moved from a cyclical trade to a secular trade,” he told MarketWatch. A secular trade has a longer duration than a cyclical one and is based on fundamental shifts, such as in technology with the rise of AI.

In his view, investors who are negative on Micron’s stock are missing the larger picture of how much demand will grow as AI adoption continues to spread.

Micron’s supply is in a deficit today, but he sees that going on for a long time.

Another area investors are missing with Micron is its adjusted free cash flow, Mortonson said, which reached $33 billion just in the last quarter and shows the company’s ability to generate cash. At the same time, Micron has paid down its balance sheet, he said, which puts it in a good position, even if the data-center trade slows down.

In the long term, Mortonson said he expects a higher multiple for Micron’s stock as supply and demand reach equilibrium toward the end of the decade.

“If you’re a long-term investor and focus on free cash flow, Micron is in the top five of any technology company right now,” he said.