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.
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- AllenBartlett·06-28Awesome analysisLikeReport
- AaronJe·06-28Strong buyLikeReport