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The Zacks Analyst Blog Micron Technology, Morgan Stanley and NVIDIA
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For Immediate Releases
Chicago, IL – September 18, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Micron Technology, Inc. (MU - Free Report) , Morgan Stanley (MS - Free Report) and NVIDIA Corporation (NVDA - Free Report) .
Here are highlights from Wednesday’s Analyst Blog:
Death Cross for MU Stock: Time to Buy Micron Based on Fundamentals?
One of the leading providers of semiconductor memory solutions, Micron Technology, Inc., recently flashed a bearish chart pattern after an eminent investment bank cut off its price target. So, what’s next for Micron investors? Shall they sell the stock or have faith in Micron’s fundamentals and hang on to it? Let’s see –
Micron Stock Is Falling; Death Cross Pattern Appears
Micron’s shares and an array of other semiconductor stocks took a beating on Monday. The Micron stock slumped 4.4% and a death cross chart pattern appeared. The short-term 50-day moving average (DMA) went below the long-term 200-DMA, indicating an imminent downtrend.
Micron’s stock closed at $87.18 yesterday, while the 50-DMA was $104 below the 200-DMA at $104.75. For the Micron stock, such a death cross pattern happened for the first time since April 28, 2022.
Bearish bets have increased on the Micron stock, with analysts at Morgan Stanley slashing the price target as they remain pessimistic about the computer memory maker’s earnings growth in the coming quarters. Morgan Stanley said the Micron stock was $140 a share. But now they expect the shares to be as little as $100.
Will Micron Stock Turn Around?
Micron is known to be a cyclical stock, so naturally, the stock would face volatility along with the economy. However, the long term bodes well for the Micron stock mostly because of the boom in artificial intelligence (AI). After all, AI needs data centers that require a lot of memory, and Micron is a memory specialist.
In AI graphic cards, Micron’s high-bandwidth memory chips (HBM) are used by tech behemoths like NVIDIA Corporation. The AI industry is expected to grow beyond $184 billion in the current year and surpass $826 billion by 2030, according to Statista.
Management is optimistic about Micron’s HBM chips, and they are expecting the HBM market to notch $86 billion in revenues by 2030 from a meager $1.8 billion last year, a CAGR of 68%.
Management also confirmed that the company has already utilized its full production capacity to fulfill the ever-growing demand for HBM chips. Interestingly, Morgan Stanley analysts still believe that strong demand by AI companies for HBM chips will boost Micron’s bottom line.
What Fundamentals Say About MU Stock?
Micron is a cash-rich company. This helps the company get involved in tactical acquisitions and other growth initiatives that enhance shareholders’ wealth. The company’s cash and investments came in at a solid $9.2 billion in the fiscal third quarter of 2024.
Micron’s revenues are also expected to improve since the demand for DRAM memory is widely projected to be soon at an all-time high. As a result, the $1.20 Zacks Consensus Estimate for MU’s earnings per share is up 160.3% yearly.
Buy, Hold or Sell MU Stock?
Based on a strong cash balance, and an increase in demand for HBM chips, it’s just a matter of time before the Micron stock would bounce back. Moreover, the Micron stock is less pricey than its peers, encouraging one to buy the dip without burning a hole in the pocket. Per the price/earnings ratio, MU trades at 9.3X forward earnings, while the Semiconductor Memory industry’s forward earnings multiple is 10.4X.
However, if a death cross is playing on your mind, and has apprehensions about Micron stock’s present performance, it’s prudent to wait for an opportune moment to buy the stock. Those who have already bought it, don’t panic, investment in Micron would be beneficial in the long run. Micron has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Micron Technology, Morgan Stanley and NVIDIA
For Immediate Releases
Chicago, IL – September 18, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Micron Technology, Inc. (MU - Free Report) , Morgan Stanley (MS - Free Report) and NVIDIA Corporation (NVDA - Free Report) .
Here are highlights from Wednesday’s Analyst Blog:
Death Cross for MU Stock: Time to Buy Micron Based on Fundamentals?
One of the leading providers of semiconductor memory solutions, Micron Technology, Inc., recently flashed a bearish chart pattern after an eminent investment bank cut off its price target. So, what’s next for Micron investors? Shall they sell the stock or have faith in Micron’s fundamentals and hang on to it? Let’s see –
Micron Stock Is Falling; Death Cross Pattern Appears
Micron’s shares and an array of other semiconductor stocks took a beating on Monday. The Micron stock slumped 4.4% and a death cross chart pattern appeared. The short-term 50-day moving average (DMA) went below the long-term 200-DMA, indicating an imminent downtrend.
Micron’s stock closed at $87.18 yesterday, while the 50-DMA was $104 below the 200-DMA at $104.75. For the Micron stock, such a death cross pattern happened for the first time since April 28, 2022.
Bearish bets have increased on the Micron stock, with analysts at Morgan Stanley slashing the price target as they remain pessimistic about the computer memory maker’s earnings growth in the coming quarters. Morgan Stanley said the Micron stock was $140 a share. But now they expect the shares to be as little as $100.
Will Micron Stock Turn Around?
Micron is known to be a cyclical stock, so naturally, the stock would face volatility along with the economy. However, the long term bodes well for the Micron stock mostly because of the boom in artificial intelligence (AI). After all, AI needs data centers that require a lot of memory, and Micron is a memory specialist.
In AI graphic cards, Micron’s high-bandwidth memory chips (HBM) are used by tech behemoths like NVIDIA Corporation. The AI industry is expected to grow beyond $184 billion in the current year and surpass $826 billion by 2030, according to Statista.
Management is optimistic about Micron’s HBM chips, and they are expecting the HBM market to notch $86 billion in revenues by 2030 from a meager $1.8 billion last year, a CAGR of 68%.
Management also confirmed that the company has already utilized its full production capacity to fulfill the ever-growing demand for HBM chips. Interestingly, Morgan Stanley analysts still believe that strong demand by AI companies for HBM chips will boost Micron’s bottom line.
What Fundamentals Say About MU Stock?
Micron is a cash-rich company. This helps the company get involved in tactical acquisitions and other growth initiatives that enhance shareholders’ wealth. The company’s cash and investments came in at a solid $9.2 billion in the fiscal third quarter of 2024.
Micron’s revenues are also expected to improve since the demand for DRAM memory is widely projected to be soon at an all-time high. As a result, the $1.20 Zacks Consensus Estimate for MU’s earnings per share is up 160.3% yearly.
Buy, Hold or Sell MU Stock?
Based on a strong cash balance, and an increase in demand for HBM chips, it’s just a matter of time before the Micron stock would bounce back. Moreover, the Micron stock is less pricey than its peers, encouraging one to buy the dip without burning a hole in the pocket. Per the price/earnings ratio, MU trades at 9.3X forward earnings, while the Semiconductor Memory industry’s forward earnings multiple is 10.4X.
However, if a death cross is playing on your mind, and has apprehensions about Micron stock’s present performance, it’s prudent to wait for an opportune moment to buy the stock. Those who have already bought it, don’t panic, investment in Micron would be beneficial in the long run. Micron has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.