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Micron (MU) Gains As Market Dips: What You Should Know

Zacks Equity Research

Micron (MU) closed the most recent trading day at $52.37, moving +0.52% from the previous trading session. This change outpaced the S&P 500's 0.38% loss on the day. Meanwhile, the Dow lost 0.46%, and the Nasdaq, a tech-heavy index, added 0.17%.

Prior to today's trading, shares of the chipmaker had lost 7.74% over the past month. This has lagged the Computer and Technology sector's loss of 5.23% and the S&P 500's loss of 4.88% in that time.

Wall Street will be looking for positivity from MU as it approaches its next earnings report date. This is expected to be March 25, 2020. The company is expected to report EPS of $0.37, down 78.36% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $4.67 billion, down 20% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.43 per share and revenue of $20.44 billion, which would represent changes of -61.73% and -12.66%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for MU. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 2.87% higher. MU is currently sporting a Zacks Rank of #1 (Strong Buy).

Digging into valuation, MU currently has a Forward P/E ratio of 21.44. For comparison, its industry has an average Forward P/E of 21.44, which means MU is trading at a no noticeable deviation to the group.

The Semiconductor Memory industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 1, putting it in the top 1% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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