Chipmaker Micron Technology Inc's shares rose as much as 13 percent to a decade high on Wednesday after the company reported strong results and signed a contract with a customer that analysts believed could be Apple Inc .
At least eight brokerages raised their price targets on the stock of the company which makes chips used mainly in PCs, mobiles, and high-end laptops.
Analysts raised their price targets on Micron's stock by as much as $7 to a high of $34. The stock rose 11 percent to $24.17 in early trading on the Nasdaq. They hit a high of $24.50 earlier.
The company on Tuesday posted a much higher-than-expected first-quarter profit, helped by strong sales at its recently acquired Elpida Memory business and a recovery in chip prices.
Micron also said on Tuesday that it signed an agreement to supply memory chips to an unnamed customer, which analysts said could be Apple, given that the iPhone maker and Elpida had a contract that ran through 2014.
"The new agreement could indicate that Apple signed a new long term supply agreement with higher volumes and better pricing with Micron," Credit Suisse analysts led by John Pitzer wrote in a note.
U.S. memory chip makers such as Micron and SanDisk Corp have benefited over last year as chip prices rebounded from lows hit in 2012.
Pitzer said the Micron contract could indicate demand was growing faster than supply and that while investors were worried about new supply coming online, buyers were more concerned with a shortage of memory chips.