Shares of U.S.-based DRAM and NAND chip market leader Micron Technology Inc. (MU) hit a multiyear high on Friday, closing up 7.4% at $28.43 per share.
Up more than 170% in the past year, shares of the Boise, Idaho-based semiconductor manufacturer were rewarded with a raft of bullish analyst notes announcing rating upgrades and higher price targets after the chip maker's fiscal Q2 earnings and guidance blew past expectations.
‘The Sun, the Moon and the Stars ...’
Analyst Betsy Van Hees at Loop Capital, who maintained a buy rating and while increasing her price target on MU to $30 from $25, said “the sun, the moon and the stars remain aligned for Micron as it benefits from the sweet spot of the memory cycle.” Analysts at MKM Partners, Deutsche Bank, Credit Suisse, Nomura, Barclays, Pacific Crest echoed this sentiment.
Barclays’ Blayne Curtis, with an overweight rating on Micron’s shares, lifted his price target to $35 from $26, noting “favorable supply/demand dynamics continue to support healthy pricing and the company improves cost.” Curtis also noted the magnitude of outperformance as attributable in part to Micron’s recent integration of Taiwanese Inotera Memories and new technologies ramp up. The analyst concluded, “we remain cognizant that the environment could eventually reverse.” (See also: Micron Closes $4.0 billion Inotera Deal.)
Joining the Bandwagon
MKM Partners, with a buy rating on Micron stock, increased its price target to $38 from $34, as Deutsche Bank, also with a buy rating, boosted its price target to $35 from $30.
John Pitzer of Credit Suisse, with an outperform rating on Micron’s shares and a new $40 price target says, “while MU is clearly benefiting from better cyclical pricing, the more important drivers seem more sustainable—mix, cost-downs and scale efficiencies.”
Nomura’s Romit Shah reiterated a buy rating on Micron and raised his price target 33% to $40, applauding Micron’s record Q3 annual earnings guidance of $6 per share.
“Micron is benefiting to an almost comical degree from strong memory trends,” said Pacific Crest analyst Weston Twigg, with a sector weight rating on shares of the DRAM and NAND chip market leader. (See also: Micron Soars on Another Upbeat Earnings Report.)