Micron is expected to see accelerated growth in revenue during 2017
Micron Technology, Inc. (NASDAQ:MU) has now broken the $22 barrier and continues to gain momentum as the strong DRAM, NAND and PC trends carry the stock forward. Following the period of elongated weakness Micron has managed to bounce back thanks to dramatic improvement in DRAM pricing and demand. The reduced capital expenditure from Micron’s competitors has also helped alleviate the situation that was created due to the oversupply of DRAM in the market.
Mizuho Securities analyst Vijay Rakesh met with the management of Micron Technology at the Consumer Electronics Show. The event was held in Las Vegas and Mr. Rakesh met the Chief Financial Officer of the Micron Technology Mr. Ernie Maddock. Mr. Maddock assured the analyst that a very strong year lies ahead for Micron and the DRAM pricing trends are likely to remain stable for the next couple of quarters. The demand in the PC market has sustained for longer than expected and if it continues to remain at current levels, there is a significant chance that Micron will be posting an upside to the current estimates. The smartphone production ramp at major smartphone producers has also played a positive part in the pricing of NAND and DRAM as the demand for semiconductor solutions has risen in general.
Datacenters are rapidly expanding and this has also resulted in significantly higher demand for Micron’s products. The company saw 40% y/y growth in its mobile DRAM and NAND business. The analyst expects a very positive year ahead for Micron and has therefore chosen to reaffirm his Buy rating and price target of $27. The analyst ratings for the company are 11 buy, 12 outperform, 3 hold and 2 underperform. The stock currently trades at a price of $22.49 and has gained 2.04% since the opening of the market session today.