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Strong Memory Chip Demand to Boost Micron's (MU) Q2 Earnings

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Micron Technology (MU - Free Report) will report its second-quarter fiscal 2022 results after market close on Mar 29.

The Boise, ID-based semiconductor company’s soon-to-be-reported quarterly results are likely to reflect the benefits from the strong memory chip demand across all its end markets, mainly across the data center, personal computer (PC) and smartphone and automotive industries.

Robust Memory Chip Demand Environment

The work-and-learn-from-home necessity amid the COVID-19 crisis has been stoking demand for cloud storage. Furthermore, the social-distancing trend has boosted the usage of online services globally. Therefore, data center operators are enhancing their cloud-storage capacities in a bid to accommodate the increasing demand for cloud services, thereby fueling demand for memory chips.

The pandemic-induced social-distancing measures are spurring demand for PCs and notebooks as more workers are now working in a hybrid office environment. This trend is likely to have continued in the fiscal second quarter as well, thereby driving demand for Micron’s memory chips.

Moreover, solid recoveries in sales across the smartphone and automotive industries are likely to have supported MU’s overall financial performance during the quarter under review.

However, industry-wide component supply constraints are expected to have hurt Micron’s top and bottom lines in the second quarter. Furthermore, Micron is witnessing supply constraints for certain integrated circuit components, which are expected to have negatively impacted the bit shipments in the quarter under review.

Micron Technology, Inc. Price and EPS Surprise Micron Technology, Inc. Price and EPS Surprise

Micron Technology, Inc. price-eps-surprise | Micron Technology, Inc. Quote

Zacks Rank & Other Stocks to Consider

Currently, MU carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks from the broader technology sector include Jabil (JBL - Free Report) , Broadcom (AVGO - Free Report) and Apple (AAPL - Free Report) . While Jabil sports a Zacks Rank #1 (Strong Buy), Broadcom and Apple each carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Jabil’s third-quarter fiscal 2022 earnings has been revised upward to $1.62 per share from $1.46 30 days ago. For fiscal 2022, earnings estimates have been revised upward by 67 cents to $7.25 per share in the past 30 days.

Jabil’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 13.5%. Shares of JBL have rallied 22.2% over the past year.

The Zacks Consensus Estimate for Broadcom’s second-quarter fiscal 2022 earnings has been revised upward by 10.2% to $8.64 per share over the past 30 days. For fiscal 2022, earnings estimates have moved upward by 7.1% to $35.49 per share over the past 30 days.

Broadcom’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 1.9%. Shares of AVGO have rallied 33.1% in the trailing 12 months.

The Zacks Consensus Estimate for Apple’s second-quarter fiscal 2022 earnings has been revised upward by five cents to $1.43 per share over the past 60 days. For fiscal 2022, earnings estimates have moved upward by a penny to $6.16 per share in the past 30 days.

Apple’s earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while meeting the same on one occasion, the average surprise being 20.3%. AAPL stock has rallied 44% over the past year.

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