Micron Technology is worth it for long-term investors, says analyst before earnings

Micron Technology is worth it for long-term investors, says analyst before earnings

Written by Sam Bogda

Micron Technology (NASDAQ:) is scheduled to report its fourth-quarter earnings on Thursday, September 29, after the market closes.

Shares of the company are down more than 47% in 2022, and investors are hoping there will be something to brag about when the semiconductor manufacturer announces its earnings.

Ahead of the data, an analyst at Morgan Stanley told investors on a note that “with the stock lower, the close to book value has clearly swung sentiment to the positive side, based on our conversations; we don’t expect anything to emerge from these gains that would dampen that.”

They still think that there is a lot of optimism about this recovery at 1:30. โ€œWe expect volumes to improve, with customer inventory drawdowns slowing, but the pace of inventory (15-20 days of inventory build-up on Micronโ€™s balance sheet in each August-November quarter) suggests that even with a 10% larger volume recall in the Weak seasonal quarter, the company will still build more than 10 days of inventory – which continues to put pressure on the market,” the analyst wrote.

Elsewhere, an analyst at Susquehanna told investors in a note that their updated estimates “reflect UR declines as MU, along with industry, becomes aggressive in cutting stocks (by cutting chip starts).

“We now expect quarterly earnings per share of approximately $0.25. BV of $45 should be considered as a downside risk,” the analyst stated.

Meanwhile, a Cowen analyst said other discretionary cuts for Micron were “kind of expected” at this point.

โ€œWe’re still under the street for the next fiscal year. Buy-side sentiment is still negative. While the stock is trading near book value, we don’t see much pullback… The challenge is that there isn’t a lot of upside in NT for investors. Memory fundamentals are tough, but MU is a worthwhile stock for LT investors,” the analyst wrote.

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