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

Zacks Equity Research

In the latest trading session, Micron (MU) closed at $53.70, marking a -0.04% move from the previous day. This change lagged the S&P 500's 1.2% gain on the day. Meanwhile, the Dow gained 1.7%, and the Nasdaq, a tech-heavy index, added 1.13%.

Investors will be hoping for strength from MU as it approaches its next earnings release, which is expected to be June 29, 2020. In that report, analysts expect MU to post earnings of $0.72 per share. This would mark a year-over-year decline of 31.43%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.25 billion, up 9.65% from the year-ago period.

MU's full-year Zacks Consensus Estimates are calling for earnings of $2.38 per share and revenue of $20.54 billion. These results would represent year-over-year changes of -62.52% and -12.26%, respectively.

Investors should also note any recent changes to analyst estimates for MU. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 13.47% higher. MU is currently sporting a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that MU has a Forward P/E ratio of 22.58 right now. This valuation marks a no noticeable deviation compared to its industry's average Forward P/E of 22.58.

Investors should also note that MU has a PEG ratio of 2.2 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Semiconductor Memory stocks are, on average, holding a PEG ratio of 2.2 based on yesterday's closing prices.

The Semiconductor Memory industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 3, putting it in the top 2% 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.

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


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