MU - Micron: Despite Its Recent Rally Micron Remains Undervalued
2024-03-25 08:26:56 ET
Summary
- Micron rallied 27.12% post-Q1 2024. At that time, I estimated the fair price to be in the range of $86-122.1.
- Micron's high-bandwidth memories are crucial as the use of data centers for AI grows.
- Micron trails Samsung and SK Hynix but benefits from cost advantages due to vertical integration.
- Micron presents a compelling "Strong Buy" with an estimated fair price of $110.40 and a future price of $199.64. This last one suggests a 13.5% annual return throughout 2029.
Thesis
In my previous article about Micron Technology, Inc. ( MU ), I assigned a buy rating on Micron citing that after comparing how the stock could be affected if it performed in line with the market. In that case, Micron would have been fairly valued and at the time, the average consensus indicated a fair price of around $122.1, which was 42% higher than the stock price at that time of $86. After this article, which was released after Q1 2024 , released on December 20, the stock rallied by 27.12%. This demonstrates that the stock possesses sufficient momentum to achieve high increases in the stock price....
Micron: Despite Its Recent Rally, Micron Remains Undervalued