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Micron (MU) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

Micron (MU) closed at $39.76 in the latest trading session, marking a -1.24% move from the prior day. This change lagged the S&P 500's 0.16% loss on the day. Meanwhile, the Dow gained 0.01%, and the Nasdaq, a tech-heavy index, lost 0.26%.

Prior to today's trading, shares of the chipmaker had lost 3.5% over the past month. This has lagged the Computer and Technology sector's loss of 0.03% and the S&P 500's loss of 0.19% in that time.

MU will be looking to display strength as it nears its next earnings release. In that report, analysts expect MU to post earnings of $0.85 per share. This would mark a year-over-year decline of 73.02%. Meanwhile, our latest consensus estimate is calling for revenue of $4.80 billion, down 38.41% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $6.40 per share and revenue of $23.51 billion, which would represent changes of -46.44% and -22.65%, respectively, from the prior year.

Any recent changes to analyst estimates for MU should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

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 remained stagnant. MU is currently a Zacks Rank #5 (Strong Sell).

Valuation is also important, so investors should note that MU has a Forward P/E ratio of 6.29 right now. Its industry sports an average Forward P/E of 6.29, so we one might conclude that MU is trading at a no noticeable deviation comparatively.

The Semiconductor Memory industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 256, which puts it in the bottom 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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