Micron Will Get Pricier With Improving DRAM Fundamentals, Analyst Anticipates

Loop Capital analyst Charles Park initiated coverage on Micron Technology, Inc MU with a Buy rating and a price target of $70.
Memory remains a cyclical industry, and since peaking in 3Q21, the industry has been in a prolonged downturn and accelerated in recent months.
Park writes that DRAM fundamentals to bottom in 1H23, with the share price typically bottoming a couple of quarters ahead.
Although the near-term macro and demand uncertainties remain and semiconductors will likely face further pressure, the key metrics suggest that the memory industry is nearing a bottom and that the risk-reward appears favorable.
The long-term outlook for the memory industry remains positive, as memory has become strategically more critical within semiconductors, and cross-cycle profitability has improved given the oligopoly nature of the DRAM industry and more rational behavior among the memory makers.
Park said MU at $52.75 offers attractive risk-reward.
The drive companies have recently significantly lowered their forecasts for the September quarter due to weaker trends, especially in Asia, where inventory corrections are currently underway.
Micron had guided a significant sequential decline and a possible loss for this quarter.
Price Action: MU shares traded lower by 3.74% at $52.81 on the last check Friday.

Momentum20.74

Growth66.21

Quality81.08

Value68.52

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