- MU stock jumps on solid fiscal Q1 earnings results.
- Micron Technology’s all-time high was set at $97.50 in July 2000.
- MU shares need to close above $90 for there to be further upside.
Micron Technology (MU) shares surged 6.8% in the afterhours trade on Monday after the semiconductor company known for its memory products released a forecast for the current fiscal quarter ahead of expectations. The company said it is now expecting to have sales of $7.5 billion for the quarter ending in February instead of the $7.32 billion expected. Management is also now expecting $1.95 in adjusted earnings per share (EPS) instead of $1.86. The stock is up about 8% on Tuesday near $89.
Micron Technology Stock News: impressive FQ1 earnings, FQ2 forecast attract investors
Mizuho was ahead of the pack by upgrading Micron to Buy in late November. It seems that the company’s new focus on industries outside the personal computer and smartphone arena is already showing results. Management boasted that growth in industrial machinery, cars, data centers and home appliances was responsible for the optimistic forecast.
After the market closed on Monday, Micron issued fiscal Q1 adjusted EPS of $2.16 compared to an average forecast of $2.10. The semiconductor also narrowly beat revenue expectations of $7.68 billion by reporting $7.69 billion. Adjusted EPS came in a whopping 177% above the year ago period, while revenue rose a healthy 33%. The earnings increase was greatly helped by the current chip backlog that has caused higher prices.
Micron is mainly a maker of dynamic random access memory (DRAM) chips and its cousin used in smartphone and smalled devices called NAND chips. Micron expects NAND demand to rise by 30% in 2022 and DRAM demand to increase between 15% and 20%.
MU key statistics
| Market Cap | $96 billion |
| Price/Earnings | 17 |
| Price/Sales | 4 |
| Price/Book | 2 |
| Enterprise Value | $94 billion |
| Operating Margin | 25% |
| Profit Margin |
21% |
| 52-week high | $96.96 |
| 52-week low | $65.67 |
| Short Interest | 2% |
| Average Wall Street Rating and Price Target | Buy, $101.28 |
Micron Technology Stock Forecast: is a turnaround in the works?
Micron stock has not felt the market’s love this past year in the same way that Nvidia (NVDA) and Advanced Micro Devices (AMD) have. As the Philadelphia Semiconductors Index (SOX) has returned 34% year to date, MU shares have only risen 11% or about half the S&P 500 performance. In fact, for much of the autumn they were in negative territory. With the latest earnings bump, it appears that Micron stock is now up near 20% on the year.
MU stock YTD compared with SOX and S&P 500
From April of this year through October, Micron stock severely lost ground, losing about one-third of its value by falling from $95 to the high $60s. With November’s three-week surge, the 9-week moving average overtook the 21-week moving average with the quickness. Now it has spent December stalling out at $90. In order to take a run at the first half of the year’s resistance level of $96, bulls need to push MU stock to close above $90.
Between March and April of this year, Micron stock faced resistance four times near $95 and 96. Above this level is only the final boss for Micron’s stock price – the 21-year all-time high of $97.50 set during the DotCom bubble of July of 2000. Will the market let this record stand for another year? We doubt it.
MU 1-week chart
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