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

Zacks Equity Research

Micron (MU) closed the most recent trading day at $55.03, moving -0.49% from the previous trading session. This change lagged the S&P 500's daily gain of 0.31%. Meanwhile, the Dow gained 0.44%, and the Nasdaq, a tech-heavy index, added 0.26%.

Prior to today's trading, shares of the chipmaker had gained 2.83% over the past month. This has lagged the Computer and Technology sector's gain of 4.64% and outpaced the S&P 500's gain of 1.18% in that time.

Investors will be hoping for strength from MU as it approaches its next earnings release. In that report, analysts expect MU to post earnings of $0.37 per share. This would mark a year-over-year decline of 78.36%. Meanwhile, our latest consensus estimate is calling for revenue of $4.66 billion, down 20.06% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.39 per share and revenue of $20.34 billion. These totals would mark changes of -62.36% and -13.1%, respectively, from last year.

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.

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.

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. The Zacks Consensus EPS estimate remained stagnant within the past month. MU is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, MU is holding a Forward P/E ratio of 23.17. For comparison, its industry has an average Forward P/E of 23.17, 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 113, putting it in the top 45% 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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