Micron Technology, Inc. Slips As Samsung Unveils Chip Factory Plan

Micron Technology, Inc. MU shares ticked down Monday on news that a competitor will ramp up production to meet growing smart-phone demand for computer chips.

Samsung Electronics said it will build a $15 billion plant in South Korea to make memory and logic chips, with production slated to start in 2017.

Samsung signaled in July it would boost in-house production. The company has recently turned to outside suppliers including Micron to meet a shortfall in supplies.

Yet the current edition of Barron's said Micron shares could increase 50 percent on rising demand for memory chips stemming from smartphones, as well as from business that need to mine useful information from large quantities of data.

The number of players in the memory chip industry has slipped to three, from about 20 in the 1990s, Barron's noted, which "has created more discipline on supply."

“Customers are coming around to the view that the memory market has changed and tight supply will last,” Micron Chief Executive Mark Durcan told Barron's. “More are looking to lock in long-term supply deals rather than buy as they go and wait for prices to come down.”

Micron, up more than 50 percent year to date, traded recently at $32.84 per share, down more than 3 percent. Share are down about 2.7 percent over the last three months..

Samsung depositary shares were up 1.3 percent recently on the London Stock Exchange.