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Investing.com - U.S. futures tumbled on Wednesday after President Donald Trump repeated threats to increase tariffs against China if the two sides do not reach a trade deal soon.
BOISE, Idaho, Nov. 19, 2019 -- Micron Technology, Inc. (Nasdaq: MU) announced today that it will hold its fiscal first quarter earnings conference call on Wednesday, December.
The technology sector is made up of companies that, among other things, manufacture consumer electronics and their components, develop software, and provide information technology (IT) services like cloud hosting. Below, we'll examine the top three stocks in the tech sector for best value, fastest earnings growth, and most momentum. HP announced in November that its board of directors had unanimously rejected an unsolicited proposal from Xerox to acquire the computer manufacturing company.
Since founding his eponymous hedge fund in 2001, Dmitry Balyasny has earned a reputation as a risk taker. He chair’s Balyasny Asset Management’s (BAM) investment committee, and oversees the delivery of consistent, alpha-driven returns. In its Q3 13F filing, BAM reported over $14.5 billion in managed securities – and had made some interesting moves in the semiconductor industry. Interesting because Balyasny has built his strategy on outperforming the broader market indexes, but the chip stocks have underperformed of late. The question raised is, does BAM see something the rest of us do not?We used TipRanks databases to get an idea. The three chip stocks in which BAM invested heavily during the last quarter are AMD, Micron, and Nvidia. All three lost heavily in 2H18, saw volatility in 1H19, and have only recently begun to regain their losses and see share prices stabilize. The TipRanks data can show what the analysts think of these stocks. As we’ll see below, when we look at the analyst reports in detail, all three companies were hit by common factors in varying combinations. The results, for them and by extension the broader chip industry, are not pretty, but may also explain what Balyasny saw, and why he moved $100 million into semiconductors last quarter.Advanced Micro Devices (AMD)At $6.5 billion in annual revenue, AMD is a mid-size player in the chip industry, but it does rival sector leader Intel in the production of x86 chips, and with Nvidia (below) shares dominance of the GPU market.Like the rest of the chip industry, AMD was hit hard by the intensification of US-China trade pressures. The ‘trade war’ hurt the company – and its peers – both at importation of raw materials and the export of finished products from and to China.The company may be past its China troubles, however, as it has just reported its best quarter since 2005. Q3 2019 showed $1.8 billion in revenue, up 8.8% year-over-year and an even more impressive 17.5% sequentially. Gross margin, at 43%, was the best result since 2012, and net income for the quarter reached $120 million. EPS, at 11 cents, was 22% improved from Q3 2018. This quarter showed increased volume and average sales price for the new Ryzen desktop processor, and was a successful full first quarter of sales for the new 7nm Zen 2. Overall, the company’s computing and graphics segment was up 79% year-over-year.Balyasny's fund picked up 885,255 shares of AMD in Q3 for ~$25.7 million. Those shares are now worth more than $34 million.Hedge funds, however, invest for the long haul, so let’s check in with the analysts to see what AMD’s prospects are like. Here, things get a little cloudier.Ross Seymore, 5-star analyst with Deutsche Bank, looks at the company’s current situation and writes, “We remain impressed by the magnitude of growth and share gains AMD in delivering within its PC CPU business and early traction within 7nm Server CPUs. However, we fear that AMD's share gain assumptions in each of these markets for 4Q19 and 2020 appear to largely ignore competitive responses from peers, nor do they consider the normalization of CPU shortages.” Seymore believes that AMD’s recent success has pushed the stock above its sustainable price. He puts a Hold on AMD, with a price target of $29, suggesting a serious downside of 24%. (To watch Seymore's track record, click here)According to TipRanks, the consensus on Wall Street is that AMD stock is a “moderate buy” for investors. But TipRanks might as well have said “sell” — because analysts, on average, think the stock, currently at $40.37, could fall about 9% to $36.68. (See AMD stock analysis on TipRanks)Micron Technology (MU)Micron took a heavy hit in late September after reporting mixed Q4 results. Fiscal 2018 revenue came in at $31.8 billion, with net profits of $5.09 billion. Shares slumped on worries about NAND and DRAM growth forward, especially as the company lowered its forward guidance. Micron expects that flat demand to improve by year’s end and going into 2020, however, and predicts gaining market share in non-volatile memory and SSD sales. Any gain in market share, however, will likely come in a smaller market unless demand improves.MU was upbeat about the prospects for 5G chips in the automotive AI market. Micron’s graphics processors are popular in AI applications, and is poised to take advantage of increased demand as automakers make headway in autonomous vehicles – with concomitant demand for high-end chips in AI systems.Balyasny made his largest chip-stock maneuver with MU, adding over 900,000 shares to his fund’s existing holding. BAM now holds 1,056,939 shares of MU, with a current market value exceeding $50 million. This is an 11% increase from when the firm bought the shares. Again, BAM’s move on MU has been justified in the short term, but Wall Street analysts see longer-term clouds on the stock.Piper Jaffray analyst Harsh Kumar took issue with Micron’s upbeat outlook on future chip market conditions in his recent review of MU. He wrote, in setting a Hold on the stocks, “Despite the company calling for a better demand environment in the second half of the year, we believe market oversupply will continue to act as a headwind to significant pricing growth. In addition, we view the company’s gross margin guidance as concerning, particularly in the uncertain macro and geopolitical environment. In our view, we see earnings below $1 on a quarterly basis over the next several quarters.” (To watch Kumar's track record, click here)Kumar’s 46 price target on MU is a bit bearish, suggesting a downside of 3.5%. He is more pessimistic on the stock than his peers on Wall Street, however. The consensus rating on MU is a Moderate Buy, based on 16 Buy ratings, 8 Holds, and 2 Sells. The average price target is $55.26, indicating room for a 17% upside from current levels. (See Micron stock analysis on TipRanks)Nvidia (NVDA)At $12.9 billion in sales for fiscal 2018, Nvidia stood as the tenth largest semiconductor company in the world. The company focuses on GPUs for professional and gaming markets, in which it competes directly with AMD above. Nvidia is moving into the mobile computing niche, and like AMD, markets its chips to the automotive AI markets. The company’s products also have a strong presence in data centers.In its recent Q3 2020 report, NVDA showed revenue down 5% from the year-ago quarter, a reflection of the industry’s headwinds, but also beat the forecasts on both revenues and earnings. In better news, the company’s revised Q4 guidance was up 34%. Analysts, however, had expected a higher revision, and NVDA share slipped $5 after the report.NVDA is up 52% year-to-date, and has been performing strongly since June. The shares were gaining when Balyasny’s firm increased its initial holding by 167,259 shares. That purchase brought the full holding up to 172,759 shares, now worth over $35 million – a gain of $5 million since the initial purchase. Once again, BAM made a chip move that brought short-term profits.Not all of Wall Street’s analysts, however, are so sure about the chip stock. Writing from Needham just last week, 5-star analyst Rajvindra Gill says, “Although we are encouraged by increased hyperscaler visibility and strength coupled with strong gaming sales, we remain cautious regarding the competitive dynamics in the data center market, specifically in the training segment… we maintain our underperform.” Gill declined to set a specific price target with his Sell rating. (To watch Gill's track record, click here)Nvidia still has a Moderate Buy consensus rating, based on 29 recent reviews. The reviews include 21 Buys, 6 Holds, and 2 Sells. Shares are selling at a premium price of $204, and the average price target of $228 suggests an upside of 11%. (See Nvidia stock analysis on TipRanks)
Investing.com – Chip stocks climbed Monday as semiconductor companies like Micron Technology that count Huawei as an important customer were given a lifeline after the U.S. extended a license that lifts restrictions on U.S. companies from selling or transferring technology to Huawei.
In our opinion one of the best tools for ordinary investors who are on the hunt for new ideas is 13F filings. Once every quarter hedge funds with at least $100 million in total positions in publicly traded US stocks are required to open the kimono and disclose the number of shares and the total […]
The fate of your portfolio is written in the stars. Or at least it can be, if Daniel Greenberg and the professional pranksters behind the “Bull and Moon” investing app have their way.
The latest round of 13F filings from institutional investors is out, revealing to the world the stocks that some of the richest and most successful investors have been buying and selling. Takeaways From ...
Micron Technology stock has been punished by a downturn in the memory chip business since last fall. Here is what the fundamentals and technical analysis say about buying MU stock now.
In his third and final "Executive Decision" segment of Mad Money Tuesday night, Jim Cramer checked back in with Sanjay Mehrotra, president and CEO of Micron Technology , the semiconductor maker that trades at just nine times earnings. Mehrotra said Micron continues to be in a very competitive marketplace, but he said his company is very different from the Micron of the past, which was very cyclical. Thanks to diversification and proprietary technologies, Micron was able to deliver its second best year ever, despite declining pricing in the market.
(Bloomberg Opinion) -- A crown jewel of President Xi Jinping’s Made in China 2025 plan is faltering.Tsinghua Unigroup Co. is the business arm of the prestigious Tsinghua University, Xi’s alma mater. The company has been trying to establish itself as a leader in China’s nascent memory-chip industry since 2015, when it famously tried to acquire stakes in U.S. rivals Micron Technology Inc. and Western Digital Corp. Both advances were rejected amid concerns that U.S. regulators wouldn’t approve the deals on national-security grounds. Rebuffed abroad, Unigroup resolved to become a domestic champion and poured its resources into developing flash-memory technology. One of its subsidiaries, three-year-old Yangtze Memory Technologies Co., is already bringing its know-how to production. It’s impressive how fast the unit has developed despite lagging behind rivals in efficiency, Bernstein Research notes.Yet credit investors are getting nervous: Unigroup’s dollar bond due in 2023 has tumbled in recent days, and is now yielding more than 10%. Last week, the chipmaker hurriedly arranged a conference call to reassure investors that its finances were in good order. Surely an asset of such national strategic importance shouldn’t be trading like a junk-rated firm bordering on bankruptcy, management reasoned. A big question hanging over Unigroup is: Who’s its real daddy? As part of China’s university reform, which aims to separate academic institutions from business endeavors, Unigroup’s controlling shareholder Tsinghua Holdings Corp. has attempted to disentangle itself from the company multiple times. The latest rout comes amid a protracted custody battle.Naturally, debtholders shudder every time speculation swirls about Unigroup’s ownership. Last year, its bonds tanked after Tsinghua agreed to sell its shares to an obscure state-owned entity in the second-tier city of Suzhou, only to recover a month later when the university opted for the cash-rich Shenzhen government instead. The bonds plummeted yet again in recent months when Tsinghua abandoned the Shenzhen deal. Then in a conference call last week, Zhao Weiguo, the holding company’s chairman, said Unigroup should remain under the Tsinghua University umbrella, making multiple references to the wishes of the “paramount leader.” For anyone in doubt, that’s Xi.Figuring out who’s holding the purse strings is particularly important for Unigroup, because like all chipmakers it needs billions of dollars in capital outlays. Industry leader Samsung Electronics Co., for example, splashed out about $25 billion annually in capital expenditure over the past five years. Yangtze Memory, Unigroup’s flash-memory business, has already spent more than 20 billion yuan ($2.86 billion) on a new plant in Wuhan and earmarked $30 billion in total spending there. The key difference is that, unlike Samsung, the Yangtze subsidiary is behind on technology and unlikely to break even until 2022 at the earliest, estimates Barclays Plc. Money has to come from the outside. Sure, Unigroup is getting financial support from China’s various venture-capital-like guidance funds and has a big credit line from China Development Bank. But investors worry that’s not enough. Obscure state-owned entities, and even Tsinghua University itself, don’t have pockets deep enough to bankroll Unigroup as it ramps up production, they wager. Revenue at Unigroup rose 7.5% from a year earlier in the first half, but its Ebitda earnings tumbled 27% to a peanut-sized 1.5 billion yuan, driven by a sharp increase in research expenses. As of June, the company sat on 39 billion yuan of cash but had 58 billion yuan of interest-bearing debt due in the year ahead. By now, conspiracy theories abound explaining Tsinghua's decision to scrap its deal with Shenzhen, often considered China’s Silicon Valley. One explanation could be ego: Why would Xi allow his alma mater’s prized asset to be controlled by a mere local state-owned entity?Investors also question whether geopolitics is at play. If Tsinghua offloaded its stake to Shenzhen, Unigroup would become a bona fide state owned enterprise, making it vulnerable to operations restrictions — from intellectual property transfer to preferential taxation — if China strikes a broader trade deal with the U.S. If Unigroup remains under the umbrella of a non-profit university, on the other hand, it could still develop its chip capacity within a gray zone. The naive might argue that Beijing can’t possibly let Unigroup go under. That may well be the case; but as I’ve written, an unhealthy undercurrent is forming in China’s bond market. Increasingly, distressed companies are pushing for quiet deals with institutional investors to delay repayment dates. This is perhaps why investors got even more nervous when news surfaced that Unigroup had asked Credit Suisse Group AG for its help to amend and extend some bank loans. Pinched by the trade war, China is now eager to become self-sufficient, and semiconductors are certainly a good place to start. Last year, China’s trade deficit in chips continued to widen to $228 billion, more than double levels from a decade earlier. But if you think Tsinghua Unigroup will emerge a clear winner from this, think again. As we’ve seen in the past, national service doesn’t necessarily get you a glittering credit score, with local government financing vehicles and regional banks alike now languishing with junk ratings. Unigroup investors would do well to remember that they can't take Xi’s school spirit to the bank. To contact the author of this story: Shuli Ren at email@example.comTo contact the editor responsible for this story: Rachel Rosenthal at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Shuli Ren is a Bloomberg Opinion columnist covering Asian markets. She previously wrote on markets for Barron's, following a career as an investment banker, and is a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
News Highlights Micron’s new QLC-based i300 1TB industrial microSD card is the industry’s highest-capacity card and can store more than three months of video footage in the.
Investing.com – Micron (NASDAQ:MU) is up about 50% for the year, but UBS cut its outlook on the chipmaker Friday amid worries that falling memory prices are likely to keep a lid on growth.
Micron Technology, Inc. (NASDAQ: MU) shares are up 2.5% Thursday as the debate rages on on Wall Street as to whether or not the semiconductor industry has hit the bottom of the current market cycle. On Thursday, Benzinga Pro subscribers received eight option alerts related to unusually large trades of Micron options. At 9:49 a.m., a trader bought 1,080 Micron put options with a $45 strike price expiring on April 17, 2020 near the ask price at $3.60.