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

Zacks Equity Research

Micron (MU) closed at $46.62 in the latest trading session, marking a +0.69% move from the prior day. This change outpaced the S&P 500's 0.15% gain on the day. Elsewhere, the Dow gained 0.1%, while the tech-heavy Nasdaq added 0.05%.

Coming into today, shares of the chipmaker had lost 2.89% in the past month. In that same time, the Computer and Technology sector gained 1%, while the S&P 500 gained 1.32%.

Investors will be hoping for strength from MU as it approaches its next earnings release, which is expected to be December 18, 2019. On that day, MU is projected to report earnings of $0.48 per share, which would represent a year-over-year decline of 83.84%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.01 billion, down 36.63% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.39 per share and revenue of $20.29 billion, which would represent changes of -62.36% and -13.33%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for MU. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 1.6% lower. MU is currently a Zacks Rank #3 (Hold).

Digging into valuation, MU currently has a Forward P/E ratio of 19.38. This represents a no noticeable deviation compared to its industry's average Forward P/E of 19.38.

The Semiconductor Memory industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 100, putting it in the top 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

To follow MU in the coming trading sessions, be sure to utilize Zacks.com.


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