In premarket trading on Monday, shares of Micron Stock ( NASDAQ:MU ) fell by about 2% after Deutsche Bank cut its rating on the memory-focused semiconductor maker, citing a deeper downturn than had been expected.
Observing that demand for memory has decreased in the enterprise after being high in the consumer arena, analyst Sidney Ho reduced his rating on Micron (MU) to hold. Ho also mentioned the “weakening” of cloud demand.
The analyst also said that Micron’s competitor in the market, Samsung ( OTCPK:SSNLF ), has not done the same thing, even though Micron ( NASDAQ:MU ) has taken multiple steps to limit supply. This is likely to “prolong the decline.”
In a message to clients, Ho stated, “We believe market confidence that the business would soon reach a cyclical low now looks premature.” The company is currently trading at about 1.2 times its book value, which means that the risk-reward ratio is “balanced.” The analyst went on to say that the book value is expected to go down by between 5% and 10% over the next three quarters.
At a ceremony, earlier this month at Taiwan Semiconductor’s Arizona factory, scheduled to open in 2024, CEO of Micron ( NASDAQ:MU ) Sanjay Mehrotra joined President Joe Biden and a number of other technology executives.
Micron Stock Outlook
The majority of analysts are wary of Micron ( NASDAQ:MU ). The Wall Street experts rank it as a BUY, while the authors of Seeking Alpha give it a HOLD rating. The Seeking Alpha quant algorithm, which often does ...
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