Micron Technology (MU) shares fell 5.78%, after an earlier rally driven by strong memory demand and the company's ability to raise prices; the stock crossed a $1 trillion market cap earlier this year but now trades near $940 billion. Its 30-day average trading volume has fallen significantly since peaking around late June, which the author cites as a sign that interest in the stock has faded. The stock's earnings multiple of 11 looks low, but the author argues it is skewed by very strong recent results, and that more supply could come online sooner than expected. With the stock up more than 1,000% over five years, some investors may simply want to cash out before it's too late, and the author says he would not buy Micron at this stage given the risks of cyclical stocks.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on Yahoo Finance ↗
Keywords
Open a keyword to see other news on the same topic.
Related news
- I Survived the Dot-Com Bubble. The Lessons I Learned From That Time Are Keeping Me Out of These 2 Tech Giants, and Here's Why
The author, who lived through the dot-com boom and bust, points to a cyclically adjusted P/E (CAPE) ratio of 41, a level exceeded only during the dot-com boom, as a sign the market is vulnerable to a meaningful downturn. Micron reported 379% revenue growth in its latest quarter and $37.7 billion in net income, but memory chip prices are highly cyclical, and the stock trades at a P/E of 12 amid fears of a sharp sell-off. Nvidia posted 106% revenue growth and $59.7 billion in net income, with a market cap above $5 trillion, but the author sees parallels with Cisco in 2000, which traded at a P/E of 241 before a $2.25 billion write-down in 2001. Nvidia's P/E of 26 is far lower and it holds a software moat, so the author expects an AI bust would more likely be a growth disruption, with the main risk being customers it finances going bankrupt.
- Here's What $6,000 Invested in Micron Could Be Worth in 2028
Micron's stock is up more than 200% this year as AI-driven memory demand surges, and the company has secured 16 strategic customer agreements running three to five years. Diluted EPS was over $74 in fiscal 2026, and S&P Global Market Intelligence consensus projects over $172 for fiscal 2027 and over $212 for fiscal 2029. If the current 5.65x forward earnings multiple is held, the stock would trade around $1,197 in 2028, about 23% upside, turning a $6,000 investment into $7,380. A 10x forward multiple would imply about $2,120 per share, in line with D.A. Davidson analyst Gil Luria's view that investors are early in understanding Micron's value, or roughly $12,940 for a $6,000 investment. The author questions how sustainable these earnings are given concerns over a new Chinese memory chip and expected heavy supply in 2029, and says owning some stock is fine while cautioning against a heavy position given its volatility.
- Why Micron Stock Looks Cheap After a Record Year
Micron, which makes memory chips for PCs and AI servers, posted a record fiscal 2026 with revenue of $133 billion and adjusted earnings of $75.52 per share, up from $8.29 a year earlier. Yet the stock closed on Oct. 28 about 13% below its earnings-day close, trading at a forward P/E of about 5.5 versus about 19 for the S&P 500. Micron has signed 26 long-term strategic customer agreements covering over 35% of expected revenue through 2030, backed by $32 billion in customer financial commitments. Adjusted free cash flow reached $62 billion for the full year, while capital spending of about $27 billion in fiscal 2026 and about $25 billion planned for the first half of fiscal 2027 will fund new supply. The article says DRAM prices and days of inventory are the two metrics to watch: if prices keep climbing and inventory days fall as management expects, the stock could keep surging next year; if inventory keeps rising while prices stall, that signals excess supply.
- Prediction: 2 Under $1 Trillion Stocks That Will Be Worth More Than Micron 5 Years From Now
The article argues that SK Hynix and AMD could surpass Micron in market value over the next five years, even though Micron already has a market cap of over 1 trillion USD. SK Hynix is described as the HBM leader with about 50% market share and a 500 billion USD long-term contract with Nvidia, while Micron's HBM share is under 20%. For AMD, the article highlights its GPUs and server CPUs for inference and agentic AI, with early commitments from OpenAI, Meta Platforms, Anthropic, Microsoft, and Oracle. Its two largest deals, 6-gigawatt commitments from OpenAI and Meta Platforms, would each be worth over 120 billion USD by the author's estimate, and the author still expects AMD to outperform Micron despite the stock not being as cheap as the other two.
- Micron Became One of the 10 Biggest Holdings in S&P 500 Index Funds. What Does That Mean for the Stock?
Micron was the ninth-largest holding in the Vanguard S&P 500 ETF (VOO) at the end of September, making up 1.82% of the fund and placing it above Tesla at 1.52%. Because the S&P 500 is weighted by float-adjusted market value, Micron's weight rose with its share price, which has more than quadrupled in the past year and passed $1 trillion in market value on May 26. After shares fell about 8% since September 30, its weight in the State Street SPDR S&P 500 ETF Trust was 1.54% on October 26, below Tesla's 1.67% and outside the top 10. Revenue for the last quarter of fiscal 2026 reached $54.2 billion, up 379% year over year, with management expecting around $61.5 billion for the first quarter of fiscal 2027, and fiscal 2026 EPS came to $74.33. At about $983, the stock trades near 13 times earnings, versus 24.7 times for the Vanguard fund, and the article links this valuation gap to memory prices' long history of cycles.
- Think You Missed Out on Micron's Run? Think Again.
Micron Technology (MU) shares have jumped nearly 350% in a short time, driven by strong revenue and earnings growth as its memory and storage chips become key to AI data centers. Demand for DRAM and NAND flash has surged while supply growth has lagged, sharply lifting prices. CEO Sanjay Mehrotra said memory and storage supply-demand will be much tighter in 2027 and 2028 than in 2026, and TrendForce expects HBM contract prices to rise 70%-140% in 2027. Micron ended fiscal 2026 with adjusted EPS up 9x to $75.52 and trades at 14 times earnings, versus 41 for the Nasdaq Composite; the author argues the valuation is still cheap relative to growth, and a 12-month price target of $1,575 implies 60% potential gains.
Related markets
Latest news
- Marvell and Lumentum shareholders unite in panning merger deal: “It's a trash offer”
Marvell agreed to buy Lumentum in an all-stock deal, and shares of both companies fell Monday. Shareholders of both companies have criticized the offer, with one describing it as “a trash offer.”
- Nvidia Reports Nov. 17. History Says What Its Stock Usually Does Next.
Nvidia will report results for its fiscal third quarter of 2027 after the close on Nov. 17, with shares near $205, about 14% below their Oct. 6 closing high of $239.24. Revenue beat the top of management's forecast range in each of the past 10 reports, yet the stock fell the next trading day after six of them, with the largest drop about 8.5% in February 2025. Most of those declines were recovered by the next report roughly three months later, though the roughly 9% gain after the August report has since faded to about 10% below its post-report close. Nvidia guides for third-quarter revenue of $108.0 billion, plus or minus 2%. The author concludes history is not a strong reason to avoid the stock before the report, leaning toward buying before Nov. 17 rather than guessing the next day's move, with shares trading at about 14 times the consensus fiscal 2028 EPS estimate of $15.80.
- Profile of Sacombank Acting CEO Nguyen Thi Kieu Anh: From VPBank Credit Officer to Leading Private Bank Executive in Vietnam
Nguyen Thi Kieu Anh was appointed acting CEO of Sacombank effective Nov. 2, 2026, replacing Loic Faussier, who became senior adviser to the board. She has more than 20 years in banking, including 18 years at VPBank, where she rose from credit officer to regional director, followed by roles at LPBank from 2023 to 2025 such as branch director and deputy CEO. She joined Sacombank in late December 2025 and was appointed deputy CEO effective Dec. 23, 2025. In March 2026, she also took on the roles of corporate governance and information disclosure officer as the bank launched a new organizational model on March 16, 2026. Her appointment comes as Sacombank accelerates completion of its restructuring plan.
- Palantir's U.S. Revenue Soars 119% as Commercial Revenue Surpasses Government Revenue for the First Time. Here's Why Its Growth Is Still Surging, Even as Other AI Stocks Falter
Palantir reported Q3 revenue of $2.3 billion, up 96% year over year and its fastest growth on record, with EPS of $0.44, up 144%, beating consensus estimates of $2.2 billion and $0.41. U.S. commercial revenue rose 148% to $984 million, surpassing U.S. government revenue of $953 million for the first time. Management raised full-year revenue growth guidance to roughly 91% from 82%. The article notes the stock trades at 125 times earnings with a PEG ratio of 0.53, and the author views the outlook positively while cautioning that the premium valuation could lead to a swift and severe rerating if results fall short.
- Apple beats sales and profit expectations but AI costs weigh on holiday sales
Apple beat analysts' expectations with record revenue for the July–September quarter, driven by iPhone and services sales, but higher AI-related costs will weigh on margins. CEO John Ternus, who succeeded Tim Cook in September, said the company is closing the year with its most ambitious lineup and hinted at a strong holiday season, including the foldable Duo. CFO Kevan Parekh guided gross margin to 45% to 46%, down from 47.9% in the September quarter, citing higher memory costs and costs tied to ramping Siri AI, which uses Google's Gemini model. Analysts had expected Apple to spend about $11 billion over the 12 months to September, a fraction of the more than $700 billion that Microsoft, Alphabet, Amazon and Meta are on track to spend this year. Parekh said AI gives customers a compelling reason to upgrade.
- Alphabet Lost $500 Billion in Market Value. Should You Really Buy AI Stocks Now?
Alphabet shares fell 13% in one session, their worst trading day ever, after parts of its earnings report disappointed investors and wiped out about $500 billion in market value. The concern centers on AI infrastructure spending: Alphabet kept its capex forecast unchanged at $195 billion to $205 billion, and free cash flow came in at negative $9 billion versus analysts' estimate of $2.7 billion. Google ads still accounted for 64% of total revenue, while the cloud business posted a record 103% revenue gain to more than $30 billion. Alphabet, Amazon, Microsoft and Meta together aim to spend more than $700 billion this year on infrastructure. The author argues that for most investors, the recent decline is a chance to buy at an attractive price, though more volatility could follow.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.