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Credit Suisse Still Sees Significant Appreciation Potential For Micron Technology, Inc.

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In a report published Friday, Credit Suisse analyst John W. Pitzer reiterated an Outperform rating and $50.00 price target on Micron Technology, Inc. (NASDAQ: MU).

In the report, Credit Suisse noted, “Despite being up 46% YTD and 353% since 1Q13 – we continue to argue that MU still has significant appreciation potential as memory is in the early stages of being recognized more as an ENABLING technology than a COMMODITY – specifically (1) supply growth is structurally slowing as Moore's Law becomes more difficult and expensive reducing structural bit growth by as much as 50%, and (2) enterprise/infrastructure is becoming a meaningful demand driver for the first time in 20 years – server content up 40% y/y on flat units, networking DRAM up 19% q/q.

"Our analysis continues to suggest that the most robust incremental driver – Data Analytics – is in the very early stages of adoption – and is likely to drive enterprise to greater than 30% of DRAM consumption (15% today) and as much as 50% over the next 1-3 years. You cannot do Big Data without BIGGER DRAM. We are raising our FY15 EPS from $3.48 to $3.62 versus street of $3.50, initiating a FY16 EPS of $4.86 versus street of $4.00 – the stock is currently trading at 8.8 times our FY15 EPS, 6.6 times FY16. Our PT of $50 is based upon a 10 times multiple on what we see as SUSTAINABLE earnings of $5 and we believe both the multiple and the earnings power are conservative. Reiterate Outperform based on our view that the next Micron is Micron.”

Micron Technology closed on Thursday at $31.70.

Latest Ratings for MU

DateFirmActionFromTo
Apr 2021MizuhoMaintainsBuy
Apr 2021SusquehannaMaintainsPositive
Apr 2021Goldman SachsReiteratesBuy

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Posted-In: Credit Suisse John W. PitzerAnalyst Color Reiteration Analyst Ratings

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