- Oops!Something went wrong.Please try again later.
Yahoo Finance Live anchors discuss Micron stock getting a downgrade by Summit Insights and some of the driving factors behind the move.
- The shares of chip maker, Micron, they are actually moving here lower on the day by about 3.25% after being downgraded by Summit Insights Group from buy to hold as they are said to be taking a more cautious approach towards the memory chip landscape that has been rattled by everything from the fabrication process to broader supply chain instances and concerns as well here. What most notably though, did you take away from the call here on the day.?
BRIAN SOZZI: Small shop, but again, it was their commentary that I think reigned supreme here this morning and what is a nervous tape here, of course. Talking about a potential slowdown in the PC market, I've been hearing a lot more tech analysts start to call this out.
BRIAN SOZZI: Yeah. I started to hear a little bit of this too within the companies as well. Deutsche Bank after this note also coming out with a cautious note on Micron, which reports their earnings on June 30 about just pressured pricing here for memory chips and also computing demand here. So a name to watch, but of course, Micron is under pressure. You have to wonder, what is the demand environment for an AMD? What is the demand environment for NVIDIA? Can these companies live up to really lofty estimates if we are going to see a macro slowdown?
JULIE HYMAN: Well, because the thesis all along had been that the problem was supply, it wasn't demand. And this is something that I was flagging earlier in the year, demand is still holding up.
BRIAN SOZZI: Now it's not.
JULIE HYMAN: Well, now it's not so much the case anymore. Not only that. The analyst from [INAUDIBLE] insight says that they thought the man was going to come back in the second half of the year. Now, saying that's not necessarily going to happen, that there's continued sluggishness in the smartphone market. So to your point, if it's affecting Micron, one would think it would have to affect the others as well.
- Well, sluggishness in the smartphone market, sluggishness in data center upgrades as well would be impacting the broader chip landscape if companies are not putting out. It's both the companies and the consumers. If the companies are not putting massive spends into the data center, and then if the consumer is not buying the new handsets, then that directly hits the chip sector head on in both of those capacities. And that's before we even get into gaming consoles, which have been terribly hard to produce at this point.
BRIAN SOZZI: So true.
JULIE HYMAN: By the way, Myles Udland's list that I gave, a partial list, some other notable ones that hit 52-week lows, although 3M is sort of lingering at that level. Disney, Goldman Sachs, Morgan Stanley, 3M, all of them hitting intraday 52-week lows, at least 52-week. In some of these cases, it's longer.
BRIAN SOZZI: And the banks. That is happening. That is happening despite the rise in yields, which is very telling.
JULIE HYMAN: At times too, when you get that compression, when you get that flattening of the yield curve, that's something that's seen affecting profits at those companies as well. But also, if there's a shrinking market and a shrinking economy, that's not necessarily good news for the banks, even if rates are overall going higher.