Tailwinds Forward for Micron: Analysts Gauge the Impression of DRAM Stock, Samsung’s Provide Cuts, and SSD Pricing Dynamics – Micron Know-how (NASDAQ:MU)

Mizuho analyst Vijay Rakesh maintained Micron Know-how Inc (NASDAQ:MU) with a Purchase and raised the worth goal from $72 to $82.

MU reviews its This autumn earnings on September 27 after the shut. The analyst expects income, gross margin, and EPS of $3.9 billion (10.6%) and ($1.19), which is according to the consensus of $3.9 billion (10.0%) and ($1.18).

Close to-term stock stays elevated at DC clients, although Cell/PC stock is usually normal. Rakesh estimates DRAM contract pricing within the September quarter is down ~5%, with declines moderating into the December quarter at down 3% Q/Q.

Additionally Learn: AI Demand, Constructive Chinese language Market Increase Micron’s Pricing Dynamics Forward Of Earnings, Says Analyst

In NAND, the analyst estimates contract pricing for the September quarter to be flat and enhance into the December quarter at up 0-5% Q/Q.

For MU’s November quarter, he estimates $4.5 billion, (1.0%) and ($0.78), above consensus of $4.2 billion, (0.8%) and ($0.99), with continued enhancements in Cell but additionally DC stock normalization.

Potential DRAM wafer provide and utilization cuts at Samsung may very well be a tailwind into 2H23 to DRAM/ NAND stock and pricing.

MU is positioned for sturdy HBM3e ramps in 2024 with share features in Gen AI demand.

Piper Sandler analyst Harsh V. Kumar reiterated a Impartial ranking and a worth goal of $70. Right now, the present setup for Micron is thrilling.

Given the Micron income break up of round 70% DRAM, he feels it could be prudent to remain on the sideline.

A lot of the cloud and enterprise clients’ stock will likely be absorbed as they exit the present calendar.

Moreover, with the well timed provide cuts initiated by Samsung and within the broader trade, Kumar expects pricing to begin to work in favor of Micron beginning subsequent 12 months.

Total, tailwinds for 2024 stay intact, which might result in a positive setup for Micron regardless of his extremely near-term cautious stance.

Micron ought to be capable to beat the highest line for the November quarter steerage barely. For August, the analyst is roughly according to consensus.

Kumar additionally expects MU to say steady pricing in most finish markets, besides cloud and enterprise, the place stabilization can be anticipated early subsequent 12 months in 2024.

Shifting to SSD, checks point out a considerable enchancment in pricing. Checks counsel that distributors have been capable of cross on a number of slight upticks in pricing to clients with out denting demand.

The distinction between the pricing dynamics for the DRAM and the SSD market stems from the surplus stock in DRAM, which continues to be a near-term headwind to cost will increase to some extent.

The analyst estimates This autumn income of $3.9 billion and EPS of $(1.19).

He tasks November quarter income of $4.43 billion and EPS of $(0.90).

MU Worth Motion: Micron Know-how shares are up 1.70% at $69.06 on the final test Friday.