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Micron (MU) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, Micron (MU) closed at $43.15, marking a +1.67% move from the previous day. This change outpaced the S&P 500's 0.66% gain on the day. Meanwhile, the Dow gained 1%, and the Nasdaq, a tech-heavy index, added 0.38%.

Heading into today, shares of the chipmaker had lost 10.58% over the past month, lagging the Computer and Technology sector's loss of 6.46% and the S&P 500's loss of 5.01% in that time.

Investors will be hoping for strength from MU as it approaches its next earnings release, which is expected to be September 26, 2019. On that day, MU is projected to report earnings of $0.46 per share, which would represent a year-over-year decline of 86.97%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.50 billion, down 46.69% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $6.22 per share and revenue of $23.04 billion, which would represent changes of -47.95% and -24.2%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for MU. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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. Within the past 30 days, our consensus EPS projection remained stagnant. MU is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, MU is holding a Forward P/E ratio of 6.82. Its industry sports an average Forward P/E of 6.82, 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 group has a Zacks Industry Rank of 105, putting it in the top 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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