Micron Technology: Good Quarter, Soft Outlook (NASDAQ:MU)

My coverage on Micron Technology (MU) has been lacking so far in 2020 as the year was and continues to be dominated by Covid-19. In fact, the last update dates back late December as I concluded that a recovery was priced into the shares at $55 at the time.

Shares have fallen by another $10 to $45 due to the impact of Covid-19; yet unlike many semiconductor plays, Micron has not been enjoying the same momentum in its operating business. I like the valuation here, yet am not chasing shares here yet, although I am inclined to buy a further dip.

What Happened?

Over the past decade, Micron has been riding the wave of increased demand for its products for all the obvious reasons and megatrends, which have been underlining the increase in demand. While its business is typically somewhat of a commodity business (certainly in the past) on a

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Micron Technology, Inc.’s (MU) CEO Sanjay Mehrotra on Q4 2020 Results – Earnings Call Transcript

Micron Technology, Inc. (NASDAQ:MU) Q4 2020 Results Earnings Conference Call September 29, 2020 4:30 PM ET

Company Participants

Farhan Ahmad – Vice President, Investor Relations

Sanjay Mehrotra – President and CEO

Dave Zinsner – Chief Financial Officer

Conference Call Participants

Toshiya Hari – Goldman Sachs

John Pitzer – Credit Suisse

C.J. Muse – Evercore

Blayne Curtis – Barclays

Harlan Sur – JP Morgan

Timothy Arcuri – UBS

Mitch Steves – RBC Capital

Ambrish Srivastava – BMO

Operator

Good afternoon. My name is Sheri, and I will be your conference facilitator today. At this time, I would like to welcome everyone to Micron’s Fourth Quarter 2020 Financial Release Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer period. [Operator Instructions]

Thank you. It is now my pleasure to turn the floor over to your host, Farhan Ahmad,

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Micron yet to regain license to sell to Huawei, pressuring sales

(Reuters) – Micron Technology Inc has not yet obtained new licenses needed to sell its memory chips to China’s Huawei Technologies Co Ltd, which will cut its sales over the next two quarters, company executives said on Tuesday.

FILE PHOTO: Micron Technology’s solid-state drive for data center customers is presented at a product launch event in San Francisco, U.S., October 24, 2019. REUTERS/Stephen Nellis/File photo

Boise, Idaho-based Micron, one of the world’s biggest makers of DRAM chips, said it had previously obtained licenses from the U.S. government to sell chips for mobile phones and servers from its factories outside the United States to Huawei, which has been the target of U.S. restrictions on chip sales since last year.

Huawei accounted for about $600 million of Micron’s $6.06 billion in sales for the fiscal fourth quarter ended Sept. 3, or just under 10%.

But a new

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Micron Shares Fall After Chipmaker Halts Shipments to Huawei

(Bloomberg) — Micron Technology Inc. shares fell after the largest U.S. chipmaker said it recently halted shipments to China’s Huawei Technologies Co.

Micron also cut capital spending plans, warned about weaker demand from some corporate customers and forecast possible oversupply in a key market next year.

Shares of the company dropped 3.6% in extended trading on Tuesday. The stock is down almost 6% for the year, while the benchmark Philadelphia Semiconductor Index is up more than 20%.

In a presentation, Micron said it halted shipments to Huawei on Sept 14. The Chinese tech giant has been hit recently by more U.S. government action designed to cut it off from suppliers.



a man wearing a suit and glasses: Key Speakers At Techonomy 2018 Conference


© Bloomberg
Key Speakers At Techonomy 2018 Conference

Sanjay Mehrotra

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Photographer: David Paul Morris/Bloomberg

Chief Executive Officer Sanjay Mehrotra said Huawei is Micron’s biggest customer and it will take time to make up for lost orders. The company’s

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Micron Technology Falls After Hours Despite Q4 Earnings Beat

Micron Technology (NASDAQ:MU) shares were taking a hit late Tuesday afternoon, following the company’s release of its fourth quarter of fiscal 2020 results after market hours.

For the quarter, the computer and mobile device memory maker actually posted encouraging fundamentals. Revenue for the period came in at $6.06 billion, a sturdy 24% higher than the same period in 2019. Non-GAAP (adjusted) net profit nearly doubled, to just under $1.23 billion ($1.08) from the year-ago result of $637 million.

Both results comfortably topped analyst estimates. Collectively, prognosticators tracking the stock were modeling $5.89 billion on the top line, and an adjusted per-share net profit of $0.98.

Two hands pulling out the guts of a USB stick.

Image source: Getty Images.

However, Micron’s guidance fell short of expectations. The company is estimating that for first quarter 2021, it will book revenue of $5.0 billion to $5.4 billion, and adjusted net earnings of $0.40 to $0.54 per share. While the former range encompasses

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Micron Technology, Inc. Reports Results for the Fourth Quarter and Full Year of Fiscal 2020

DRAM portfolio strengthened with 1z ramp; High-value NAND shipments reach record levels in FY20

BOISE, Idaho, Sept. 29, 2020 (GLOBE NEWSWIRE) — Micron Technology, Inc. (Nasdaq: MU) today announced results for its fourth quarter and full year of fiscal 2020, which ended Sept. 3, 2020.

Fiscal Q4 2020 highlights

  • Revenue of $6.06 billion versus $5.44 billion for the prior quarter and $4.87 billion for the same period last year
  • GAAP net income of $988 million, or $0.87 per diluted share
  • Non-GAAP net income of $1.23 billion, or $1.08 per diluted share
  • Operating cash flow of $2.27 billion versus $2.02 billion for the prior quarter and $2.23 billion for the same period last year

Fiscal 2020 highlights

  • Revenue of $21.44 billion versus $23.41 billion for the prior year
  • GAAP net income of $2.69 billion, or $2.37 per diluted share
  • Non-GAAP net income of $3.24 billion, or $2.83 per diluted share
  • Operating
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Micron Technology Placed on Citi Negative Catalyst Watch

A Citi analyst on Monday opened a negative catalyst watch on shares of Micron Technology  (MU) – Get Report, a day before the semiconductor company is scheduled to report fourth-quarter earnings.

Shares of the Boise, Idaho, company at last check were up 0.4% at $49.31.

Analyst Christopher Danely, who has a sell rating on the shares with a $35 price target, said he expected Micron to report sales below guidance of $6 billion but in line with his $5.5 billion estimate due to what he called a double dip in DRAM.

The analyst also expects the stock to trade lower on the report and would be more constructive on the stock in the mid $30s, according to The Fly.

Last week, TheStreet.com Founder Jim Cramer said on CNBC that “Micron’s core DRAM business could be saved by their disk drive business, but I don’t see the stock

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JPMorgan Chase, Citigroup, PepsiCo and Micron Technology are part of Zacks Earnings Preview

For Immediate Release

Chicago, IL – September 28, 2020 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes JPMorgan Chase & Co. JPM, Citigroup Inc. C, PepsiCo, Inc. PEP and Micron Technology, Inc. MU.

Handicapping Q3 Earnings Season

The overall earnings picture has been steadily improving over the last three months as big parts of the U.S. economy have started coming out of the pandemic-driven lockdown. The market will be looking for this improving earnings trend to accelerate in the Q3 earnings season.

The wide majority of companies have fiscal quarters that correspond with the calendar quarters, which is September 30th for Q3. These calendar-quarter companies will start reporting Q3 results after September 30th. Back in the day when Alcoa was in all the major indexes, the aluminum producer was generally seen as kick-starting quarterly reporting cycles.

The rump Alcoa

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Price Over Earnings Overview: Micron Technology

In the current market session, Micron Technology Inc. (NASDAQ: MU) is trading at $45.83, after a 1.51% increase. However, over the past month, the stock decreased by 0.67%, and in the past year, by 9.25%. Shareholders might be interested in knowing whether the stock is undervalued, even if the company is performing up to par in the current session.

The stock is currently higher from its 52 week low by 47.22%. Assuming that all other factors are held constant, this could present itself as an opportunity for investors trying to diversify their portfolio with Semiconductors stocks, and capitalize on the lower share price observed over the year.

The P/E ratio is used by long-term shareholders to assess the company’s market performance against aggregate market data, historical earnings, and the industry at large. A lower P/E indicates that shareholders do not expect the stock to perform better in the future, and

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Micron Technology or NVIDIA: Which One to Buy Right Now?

NVIDIA (NASDAQ:NVDA) shares have more than doubled so far in 2020 thanks to strong momentum in the graphics specialist’s video gaming and data center businesses, but Micron Technology (NASDAQ:MU) has been witnessing tough times, as there seems to be uncertainty about the memory industry’s dynamics.

Micron’s lukewarm guidance for the forthcoming quarters has spooked investors of late. NVIDIA, on the other hand, is promising better times ahead on the back of new products and lucrative opportunities in fast-growing markets. However, not all investors will like NVIDIA stock right now because of its rich valuation. Micron’s valuation is reasonable in comparison, but does that make it a better bet over NVIDIA?

Let’s find out.

NVDA Chart

NVDA data by YCharts

Micron’s weakness may not last long

Micron Technology may have given investors a scare in recent weeks, but the memory industry’s dynamics seem to indicate its fortunes could change. Goldman Sachs recently upgraded

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