$Micron Technology(MU)$ I star

I started building a position in $MU today in the low $130s (so I’m a little biased) but the stock is simply too cheap especially when you compare it to $AMD.

$AMD has a $250B market cap and is expected to do $5.5B of EBITDA over the next 12 months so it’s trading at 45x NTM EV/EBITDA.

$MU has a $150B market cap and is expected to do $20B of EBITDA over the next 12 months so it’s trading at 7.5x NTM EV/EBITDA.

$AMD better do $8-10B next year in MI-chip sales or the stock will get pounded because it’s wildly overvalued in that scenario.

I know that $MU has always traded with a lower multiple because DRAM/SSD is a cyclical business with pricing troughs but HBM in the context of an AI-revolution means higher growth rates, higher margins, bigger profits, bigger buybacks … all of which should lead to multiple expansion.

I think $MU could be a $250 stock in the next 18 months.

Will You Bottom Micron at $130 or Lower?

Micron's financial report significantly exceeded market expectations in all indicators, and its outlook guidance generally met market expectations. However, despite excellent financial performance, the outlook guidance not exceeding market expectations caused the stock price to fall in after-hours trading. --------------------------- What's your target price for Micron? Will you hold Micron in the long-term?

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Comments

AllenBartlett
2024-06-28
AllenBartlett
Awesome analysis
AaronJe
2024-06-28
AaronJe
Strong buy

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