The Actual Recommended
Technology Weekly Options Trade.....
** OPTION TRADE: Buy MU DEC 31 2021 83.000 CALLS at approximately $3.50.
(Actually bought for $2.95)
Technology Weekly Call Options Trade
Friday, December 17, 2021
- Bought at 10:24 for $2.95
Tuesday, December 21, 2021
Total Potential Profit is 187%
It is very likely that Micron Technology stock will continue to climb if the market continues in a positive
Join us and see
what other trades we are proposing!
Micron Technology Earnings Report…..
Micron Technology Inc. shares shot to
their best gain in more than a year Tuesday, after the memory-chip specialist
provided a forecast for 2022 that offered more optimism than analysts expected.
The stock was up nearly 10% on Tuesday and was heading back toward the all-time
highs hit earlier this year.
Micron reported Q1 revenue of $7.69
billion, up 33.2% year-on-year, above the consensus of $7.67 billion. Adjusted
EPS of $2.16 beat the consensus of $2.11.
year-over-year basis, Micron earnings jumped 161% while sales rose 33%.
Micron sees Q2 revenue of $7.3
billion - $7.7 billion above the consensus of $7.28 billion. It considers an
adjusted EPS of $1.85 - $2.05 above the consensus of $1.86.
Perhaps the most important
phrase of the earnings release and management commentary was from CEO Sanjay
With the successful ramp of 1α DRAM and 176-layer NAND
products across major end markets, we are several quarters ahead of the
industry in market deployment of these leading-edge process technologies. The
combination of 1α and 1z DRAM nodes represents the majority of our DRAM bit
When Mehrotra took over as
Micron's CEO in May 2017, the company's memory technologies lagged behind its
two main competitors, Samsung and SK Hynix.
However, it appears that
Mehrotra's operational discipline has enabled Micron to leapfrog its two main
competitors in DRAM, and it's now also a leader in the larger NAND flash sector
as well, which has about six major competitors.
Analysts Are Delighted.....
that Micron will pull back on capital spending were put to rest with Monday’s
report, analysts said.
“We believe management’s comments
help alleviate bear concerns that the memory market is heading toward another downturn, which in
turn, could stall capital spending plans,” Stifel analysts wrote, while
maintaining a “strong buy” rating. “The
company believes 2022 likely will see a ‘healthy supply-demand dynamic’ in both
DRAM and NAND, which is consistent with our outlook (and if anything, we
believe there could be a return to a supply imbalance versus a strong demand
analyst Matt Bryson named his note “Memory
winter turns into spring,” and noted that Micron executives’ forecast was a
surprise given “typical conservatism” from the company’s management team.
“Micron surprised us and the Street
by providing robust guidance that suggests both Micron and the memory market
are nearing a very shallow cyclical trough rather than the harsh wintery
downturn some had projected,” Bryson wrote, while increasing his price target
to $100 from $85. “While we believe forward expectations for memory
fundamentals have indeed improved through the course of the quarter discounting
the likelihood of a longer cyclical decline, management surprised us by providing
guidance that anticipates stabilizing conditions in light of their bias towards
James, analyst Chris Caso said in his note to clients: "As compared to three months ago, Micron has seen some
stabilization in the PC market."
"We believe Micron remains
well-poised to benefit from sustained demand drivers (PC, data center, 5G
smartphone) heading into calendar 2022 as data-centric and data-intensive
applications continue to proliferate across most platforms," JPMorgan analyst Harlan Sur said in
a recent report.
"From a long-term perspective, MU
stock is executing well on cost-downs and management expects DRAM and NAND
cost-per-bit (manufacturing) declines to be in line with the industry in fiscal
Bank analyst Sidney Ho in a report said the outlook for Micron's core DRAM
memory chip market "appears to be
"We continue to believe that
the current DRAM trough will be less severe and shorter than previously
expected," Ho added.
"Over the last 10 years,
semiconductor stocks have enjoyed significant multiple expansion — with
multiples increasing from 13 times to 15 times free cash flow to 20 times to 25
times," said Credit
Suisse analyst John Pitzer in a report.
on to say, "During that same period,
MU's multiple, while cyclically volatile, has remained mostly unchanged. More
consistent returns and recognition of memory's growing importance to the Data
Economy will drive meaningful FCF growth and multiple expansion."
At least 17
of the 36 analysts who track Micron increased their price targets in response
to the earnings, while cheering a bullish forecast from executives.....
- Summit Insights analyst Kinngai Chan upgraded to Buy from Hold. Chan
contends that the downside risk of Micron's customers buying ahead of demand is
now priced into the stock.
- Baird analyst Tristan Gerra raised the PT to $90 from $70
(9.7% upside) and kept a Neutral.
- Goldman Sachs analyst Toshiya Hari raised the PT to $101 from $88
(23.1% upside) and kept a Buy.
- Raymond James analyst Chris Caso raised the PT from $100 to $115
(40.2% upside) and kept a Strong Buy.
- Credit Suisse analyst John Pitzer maintained an Outperform and
increased the PT from $110 to $130 (58.5% upside).
- Mizuho analyst Vijay Rakesh reiterated a Buy and raised the
PT from $95 to $98 (19.5% upside).
- B of A Securities analyst Vivek Arya upgraded from Neutral to Buy and
increased the PT from $76 to $100 (21.9% upside).
- Piper Sandler raised the PT from $70 to $90,
- Deutsche Bank increased from $90 to $100,
- BMO Capital lifted from $105 to $115, and
- Wedbush from $85 to $100.