Why Micron Technology (MU) Stock Rocketed Higher Today

Radek Strnad /
2023/03/29 4:36 pm EDT
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What Happened:

Shares of Memory chips maker Micron (NYSE:MU) jumped 6.57% in the morning session after the company reported earnings for the latest quarter. While the results trailed the consensus estimates for revenue and operating profits, Wall Street analysts noted that the semiconductor company had faced a steeper slump than anticipated, but signs of a rebound are emerging. The outlook from the company was optimistic, with Sanjay Mehrotra, the chief executive, affirming his "confidence" in the long-term demand scenario and envisaging "gradual improvements" in the industry's supply-demand equation. The stock reaction suggests that the market is putting more weight on longer-term risk/reward than near-term cyclical results. 

What is the market telling us:

Micron Technology's shares are somewhat volatile and over the last year have had 18 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.

Micron Technology is up 26.2% since the beginning of the year, but at $63.56 per share it is still trading 22.5% below its 52-week high of $82.05 from March 2022. Investors who bought $1,000 worth of Micron Technology's shares 5 years ago would now be looking at an investment worth $1,219.4.

Is now the time to buy Micron Technology? Access our full analysis of the earnings results here, it's free.