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Technology Stocks : Semi Equipment Analysis
SOXX 233.46-0.9%10:56 AM EST

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From: Sam6/12/2019 1:33:14 PM
1 Recommendation   of 84199
 
Micron Earnings Will Tumble Because Chip Prices Have Further to Fall, Analyst Says -- Barrons.com
DOW JONES & COMPANY, INC. 1:30 PM ET 6/12/2019

Symbol Last Price Change
32.9 -1.94 (-5.57%)
QUOTES AS OF 01:31:13 PM ET 06/12/2019


The memory chip industry will face more difficult times the rest of the year, according to Evercore ISI, which lowered its earnings estimates for Micron citing weaker industry conditions.

The back story. Micron Technology(MU) stock has been sliding for the past month as hope for a recovery in chip prices has faltered. A few months ago, the stock was up more than 30% for the year.

The chip maker is a leader in the DRAM and NAND memory-semiconductor markets. DRAM stands for dynamic random-access memory, which is used in desktop computers and servers, while NAND is flash memory, found in smartphones and solid-state hard drives.

What's new. Evercore ISI analyst C.J. Muse on Wednesday lowered his earnings estimates for Micron saying the company will be negatively impacted by weaker conditions in the memory industry. He reaffirmed his Outperform rating for the stock.

"We believe that a slower demand recovery coupled with excess inventory is leading to steeper than expected pricing declines through the remainder of the year," he wrote.

Micron stock was down 5.1% to $33.06 on Wednesday. The company did not immediately respond to a request for comment.

The analyst lowered his Micron earnings per share estimates to $2.86 from $3.24 for 2019 and to 67 cents from $2.75 for 2020.

Looking ahead. The analyst reaffirmed his $60 price target for Micron stock due to his confidence in the company's long-term opportunities.

Earlier this month, Barron's suggested there may be more downside for the chip sector due to deteriorating fundamentals.

Write to Tae Kim at tae.kim@barrons.com

[ Wow, this is the lowest estimate for 2020 I've seen. 67 cents. For the year? That seems to be what the article says. Yet the analyst maintains a $60 price target. smh ]
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