The Zacks Analyst Blog Highlights Stocks recently featured in the blog include: SAP SE,Applied Materials, Micron Technology, Canterbury Park and Village Super Market
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 14 2024
0mins
Should l Buy MU?
Source: NASDAQ.COM
- Stocks Featured in Analyst Blog: Zacks.com features stocks like SAP SE, Applied Materials, Inc., Micron Technology, Inc., Canterbury Park Holding Corp., and Village Super Market, Inc. in their Analyst Blog.
- Research Daily Highlights: Zacks Research Daily presents research reports on 16 major stocks, including SAP SE, Applied Materials, Inc., Micron Technology, Inc., Canterbury Park Holding Corp., and Village Super Market, Inc.
- SAP SE Analysis: SAP shares have outperformed the industry due to cloud business strength, generative AI, and strategic growth areas, but face concerns over macroeconomic conditions and rising costs.
- Applied Materials Analysis: Applied Materials benefits from services segment strength and investments in IoT and AI, but faces challenges in Semiconductor Systems segment and demand environment.
- Micron Technology Analysis: Micron Technology sees growth from market conditions, sales executions, and pricing benefits, but is threatened by the US-China trade war.
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Analyst Views on MU
Wall Street analysts forecast MU stock price to rise
26 Analyst Rating
24 Buy
2 Hold
0 Sell
Strong Buy
Current: 321.800
Low
235.00
Averages
336.12
High
500.00
Current: 321.800
Low
235.00
Averages
336.12
High
500.00
About MU
Micron Technology, Inc. provides memory and storage solutions. The Company delivers a portfolio of high-performance dynamic random-access memory (DRAM), NAND, and NOR memory and storage products through its Micron and Crucial brands. The Company's products enable advancing in artificial intelligence (AI) and compute-intensive applications. Its segments include Cloud Memory Business Unit (CMBU), Core Data Center Business Unit (CDBU), Mobile and Client Business Unit (MCBU) and Automotive and Embedded Business Unit (AEBU). CMBU is focused on memory solutions for large hyperscale cloud customers, and high bandwidth memory (HBM) for all data center customers. CDBU is focused on memory solutions for mid-tier cloud, enterprise, and OEM data center customers and storage solutions for all data center customers. MCBU is focused on memory and storage solutions for mobile and client segments. AEBU is focused on memory and storage solutions for the automotive, industrial, and consumer segments.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Micron Technology Surpasses Earnings Expectations, Optimistic Outlook Ahead
- Strong Earnings Report: Micron Technology reported $23.9 billion in revenue for Q2 FY2026, a staggering 300% year-over-year increase, surpassing Wall Street's expectations of $18.7 billion, indicating robust market demand and pricing conditions.
- Significant Profit Growth: The company's earnings per share reached $12.20, nearly an 8-fold increase year-over-year, far exceeding analysts' expectations of $8.42, showcasing Micron's strong growth potential in the memory market.
- Optimistic Future Outlook: Micron anticipates revenue of $33.5 billion for the current quarter, a 3.6-fold increase from the previous year, with earnings guidance of $19.15 per share, reflecting strong confidence in future growth.
- Cautious Market Reaction: Despite the impressive earnings report, the stock retreated due to market concerns about its growth potential, with analysts suggesting a 55% upside in the stock price over the next year, indicating a potential underestimation of Micron's long-term growth prospects.
See More
Micron's HBM4 Mass Production Marks Technological Breakthrough
- Technological Breakthrough: Micron's HBM4 36GB 12-Hi memory has entered mass production, marking a significant shift as the company is no longer seen as a technological laggard, which is expected to enhance its competitiveness in the high-bandwidth memory market, particularly through its collaboration with Nvidia's Vera Rubin platform.
- Revenue Growth: Over the past year, Micron has benefited from supercycles in the DRAM and NAND markets, with revenue nearly tripling and gross margins exceeding 74.4%, indicating strong performance and improved profitability in the market.
- Strategic Customer Agreement: Micron has signed its first-ever five-year strategic customer agreement, providing greater market visibility and marking a significant shift from being viewed as a cyclical commodity to a high-tech AI growth stock, which is expected to lead to sustained revenue growth.
- Market Potential: Micron's HBM4 solution boasts more than double the bandwidth of HBM3 and a 20% improvement in power efficiency, and combined with its close partnership with Nvidia, it is anticipated to drive market share in the AI infrastructure space, further solidifying its position in the industry.
See More
AI Chip Giants Show Promising Outlook Amid Market Challenges
- Market Challenges and Opportunities: Despite market pressures from concerns over the Middle East conflict and the sustainability of AI trades, both Micron Technology and Analog Devices demonstrate strong business outlooks, attracting investor interest.
- Micron's Growth Potential: Micron is expected to see over 100% revenue and earnings growth rates by 2026, with its Dynamic Random Access Memory (DRAM) revenues rising due to surging demand for AI infrastructure, solidifying its leadership position in the market.
- Analog Devices' Robust Performance: Analog Devices anticipates revenue and earnings growth rates of 25.15% and 44%, respectively, for 2026, with strong performance in automation and electric vehicle sectors providing multi-year growth tailwinds.
- Attractive Valuations: Micron's forward P/E ratio stands at 6.12, significantly below the industry average of 19.03, indicating a potential 52% price increase, while Analog Devices' target price suggests a 41.9% upside, drawing investor attention.
See More
Micron Technology Shares Decline Due to Falling DRAM Prices
- DRAM Price Decline: Since Micron Technology reported its Q2 earnings on March 18, mainstream DDR5 16GB DRAM prices have dropped by 6%, prompting Citi to lower its price target for Micron from $510 to $425, indicating market concerns over storage product demand.
- Long-Term Agreement Negotiations: Micron and its memory peers have initiated negotiations with hyperscalers for 3-5 year strategic agreements aimed at locking in base volumes, prepayments, and quarterly pricing adjustments based on market conditions, which is expected to support contract prices and alleviate short-term price volatility.
- Impact of Google Technology: Google's TurboQuant technology is seen as a key factor in the decline of DRAM spot prices, with Citi analysts noting that while it reduces AI compute and memory costs, it may also increase demand, suggesting a complex relationship between pricing and technology adoption.
- Market Reaction: Following Google's announcement of TurboQuant on March 24, Micron's share price has fallen by 19%, a trend that has also affected memory and storage stocks like Western Digital, Seagate Technology, and Sandisk, reflecting widespread market concerns about the outlook for the memory and storage sectors.
See More
Wall Street's Latest Ratings Overview
- Visa and Mastercard Ratings: Loop initiates coverage on Visa and Mastercard with a buy rating, anticipating significant net revenue growth driven by market share gains and upside from foreign exchange volatility, enhancing their competitive edge in the payment processing sector.
- Arista and Cisco Buy Ratings: Truist initiates buy ratings for Arista Networks and Cisco, citing their high-quality business scale and thematic attractiveness, particularly in the data center growth space, which presents underappreciated opportunities.
- 10X Genomics Upgrade: William Blair upgrades 10X Genomics from market perform to outperform, highlighting its pivotal role in AI drug discovery and improved profitability, which is expected to drive future growth following five consecutive topline beats.
- MiniMed Platform Outlook: Morgan Stanley initiates MiniMed at overweight with a $19 price target, projecting that its differentiated diabetes management platform will drive growth and margin expansion, particularly given the significant underpenetration in the U.S. market.
See More
Nvidia's Vera Rubin GPU Design Change Impacts Memory Stocks
- Design Change Impact: Nvidia's shift from a 4-die to a 2-die design for its Vera Rubin GPU line has led to significant declines in memory stocks, with companies like Micron Technology (MU) and Western Digital (WDC) seeing drops between 4.5% and 10% on Monday, indicating market concerns over the new design's viability.
- Market Reaction: Analyst Jeff Pu from GF Securities noted that the complexity of 4-die packaging makes its likelihood low, and he now expects two versions: Rubin Ultra 2-die and Rubin Ultra 2-die x 2, which may affect demand for related memory components.
- Memory Component Stability: Despite the design changes, Pu believes the impact on components within Vera Rubin is minimal, as fewer packaged dies are expected to lead to a higher volume of packaged Rubin Ultra, maintaining the expectation of using next-generation high-bandwidth memory (HBM4E) at 64 GB per cube.
- Industry Outlook: The decline in memory, storage, and optical stocks has dragged down the entire chip sector, although Pu pointed out that other components like optical are unaffected in terms of bandwidth, suggesting that market confidence in Nvidia and its partners remains intact.
See More
Micron Technology Surpasses Earnings Expectations, Optimistic Outlook Ahead
- Strong Earnings Report: Micron Technology reported $23.9 billion in revenue for Q2 FY2026, a staggering 300% year-over-year increase, surpassing Wall Street's expectations of $18.7 billion, indicating robust market demand and pricing conditions.
- Significant Profit Growth: The company's earnings per share reached $12.20, nearly an 8-fold increase year-over-year, far exceeding analysts' expectations of $8.42, showcasing Micron's strong growth potential in the memory market.
- Optimistic Future Outlook: Micron anticipates revenue of $33.5 billion for the current quarter, a 3.6-fold increase from the previous year, with earnings guidance of $19.15 per share, reflecting strong confidence in future growth.
- Cautious Market Reaction: Despite the impressive earnings report, the stock retreated due to market concerns about its growth potential, with analysts suggesting a 55% upside in the stock price over the next year, indicating a potential underestimation of Micron's long-term growth prospects.
See More
Micron's HBM4 Mass Production Marks Technological Breakthrough
- Technological Breakthrough: Micron's HBM4 36GB 12-Hi memory has entered mass production, marking a significant shift as the company is no longer seen as a technological laggard, which is expected to enhance its competitiveness in the high-bandwidth memory market, particularly through its collaboration with Nvidia's Vera Rubin platform.
- Revenue Growth: Over the past year, Micron has benefited from supercycles in the DRAM and NAND markets, with revenue nearly tripling and gross margins exceeding 74.4%, indicating strong performance and improved profitability in the market.
- Strategic Customer Agreement: Micron has signed its first-ever five-year strategic customer agreement, providing greater market visibility and marking a significant shift from being viewed as a cyclical commodity to a high-tech AI growth stock, which is expected to lead to sustained revenue growth.
- Market Potential: Micron's HBM4 solution boasts more than double the bandwidth of HBM3 and a 20% improvement in power efficiency, and combined with its close partnership with Nvidia, it is anticipated to drive market share in the AI infrastructure space, further solidifying its position in the industry.
See More
AI Chip Giants Show Promising Outlook Amid Market Challenges
- Market Challenges and Opportunities: Despite market pressures from concerns over the Middle East conflict and the sustainability of AI trades, both Micron Technology and Analog Devices demonstrate strong business outlooks, attracting investor interest.
- Micron's Growth Potential: Micron is expected to see over 100% revenue and earnings growth rates by 2026, with its Dynamic Random Access Memory (DRAM) revenues rising due to surging demand for AI infrastructure, solidifying its leadership position in the market.
- Analog Devices' Robust Performance: Analog Devices anticipates revenue and earnings growth rates of 25.15% and 44%, respectively, for 2026, with strong performance in automation and electric vehicle sectors providing multi-year growth tailwinds.
- Attractive Valuations: Micron's forward P/E ratio stands at 6.12, significantly below the industry average of 19.03, indicating a potential 52% price increase, while Analog Devices' target price suggests a 41.9% upside, drawing investor attention.
See More
Micron Technology Shares Decline Due to Falling DRAM Prices
- DRAM Price Decline: Since Micron Technology reported its Q2 earnings on March 18, mainstream DDR5 16GB DRAM prices have dropped by 6%, prompting Citi to lower its price target for Micron from $510 to $425, indicating market concerns over storage product demand.
- Long-Term Agreement Negotiations: Micron and its memory peers have initiated negotiations with hyperscalers for 3-5 year strategic agreements aimed at locking in base volumes, prepayments, and quarterly pricing adjustments based on market conditions, which is expected to support contract prices and alleviate short-term price volatility.
- Impact of Google Technology: Google's TurboQuant technology is seen as a key factor in the decline of DRAM spot prices, with Citi analysts noting that while it reduces AI compute and memory costs, it may also increase demand, suggesting a complex relationship between pricing and technology adoption.
- Market Reaction: Following Google's announcement of TurboQuant on March 24, Micron's share price has fallen by 19%, a trend that has also affected memory and storage stocks like Western Digital, Seagate Technology, and Sandisk, reflecting widespread market concerns about the outlook for the memory and storage sectors.
See More
Wall Street's Latest Ratings Overview
- Visa and Mastercard Ratings: Loop initiates coverage on Visa and Mastercard with a buy rating, anticipating significant net revenue growth driven by market share gains and upside from foreign exchange volatility, enhancing their competitive edge in the payment processing sector.
- Arista and Cisco Buy Ratings: Truist initiates buy ratings for Arista Networks and Cisco, citing their high-quality business scale and thematic attractiveness, particularly in the data center growth space, which presents underappreciated opportunities.
- 10X Genomics Upgrade: William Blair upgrades 10X Genomics from market perform to outperform, highlighting its pivotal role in AI drug discovery and improved profitability, which is expected to drive future growth following five consecutive topline beats.
- MiniMed Platform Outlook: Morgan Stanley initiates MiniMed at overweight with a $19 price target, projecting that its differentiated diabetes management platform will drive growth and margin expansion, particularly given the significant underpenetration in the U.S. market.
See More
Nvidia's Vera Rubin GPU Design Change Impacts Memory Stocks
- Design Change Impact: Nvidia's shift from a 4-die to a 2-die design for its Vera Rubin GPU line has led to significant declines in memory stocks, with companies like Micron Technology (MU) and Western Digital (WDC) seeing drops between 4.5% and 10% on Monday, indicating market concerns over the new design's viability.
- Market Reaction: Analyst Jeff Pu from GF Securities noted that the complexity of 4-die packaging makes its likelihood low, and he now expects two versions: Rubin Ultra 2-die and Rubin Ultra 2-die x 2, which may affect demand for related memory components.
- Memory Component Stability: Despite the design changes, Pu believes the impact on components within Vera Rubin is minimal, as fewer packaged dies are expected to lead to a higher volume of packaged Rubin Ultra, maintaining the expectation of using next-generation high-bandwidth memory (HBM4E) at 64 GB per cube.
- Industry Outlook: The decline in memory, storage, and optical stocks has dragged down the entire chip sector, although Pu pointed out that other components like optical are unaffected in terms of bandwidth, suggesting that market confidence in Nvidia and its partners remains intact.
See More
