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Micron Technology stock pric is down over 27% in 3 months is that a buying opportunity or is this a reason for investors to dump micron's stock and move on to something else that's performing better I'll answer that question in this video reviewing Micron Technology's latest results comparing it against its new valuation at this lower price to determine if I still think Micron Technology stock is worth holding down 27.24 in the last 3 months disappointing investors after it started the year really strong year to date if we zoom out you can see Micron Technology stock is still up 11% even after that big stock price decline the company performed well to begin the year but reached a headwind as it reached its 52 weeks high now I've had Micron Technology stock rated as a top 25 stock to buy in 2024 and I last updated that recommendation on July 2nd in its latest quarterly financial report Micron Technology told investors that it generated $ 6.81 billion in Revenue versus 5.8 billion in the prior quarter and 3.75 billion in the same quarter last year that means the company's Revenue jumped by by over $3 billion year over-year operating cash flow similarly jumped to 2.5 billion compared to 1.2 billion in the previous quarter and only 24 million in the same quarter last year Micron Technology last year was suffering from an inventory glut in the industry and now it's recovering from that cyclical bottom and Good Times remain ahead for Micron Technology the company CEO saying the robust AI demand andr execution enabled Micron to deliver 177% growth exceeding the high end of our guidance we are gaining market share in high margin products like hbm and our data center SSD Revenue hit record highs demonstrating the strength of our AI product portfolio across dram and storage we are excited about the aid driven 2025 so its prospects look excellent what's more Micron Technology in the latest quarterly conference call told investors that not only are they going to sell more units of dam and storage they're also going to generate higher prices for those newer units prospects look really strong for Micron Technology and that's partly why I've kept Micron Technology rated as one of my top stocks to buy in 2024 the industry Tailwinds look very very good for Micron Technology across the board whether you look at smartphone segment growth whether you look at personal computer segment growth or you look at data center growth they're all rebounding excellently and Micron Technology as a leader in those Industries in dram and storage is positioned to benefit from that Trend the one thing that's kept Micron Technology from performing even better than it has in terms of its stock price is the substan Cal investments in capital expenditure the company is making to benefit from that growth it needs to expand manufacturing capacity in order to benefit from that growth industrywide in its latest quarter the company highlighted that it spent 2.06 billion in capital expenditures that's roughly onethird of Revenue of 6.8 billion it generated in the quarter investing 33% of Revenue in capital expenditure is a really high percentage however Micron Technology is doing this at an opportune time the company is getting support from the US government to expand Manufacturing in the United States and so it's benefiting from that will and that will reduce the amount that Micron Technology has to put up to facilitate the growth in its manufacturing capacity now for the next quarter Micron is forecasting revenue of 7.6 billion so that would be an increase of 800 million from the previous quarter and diluted earnings per share of 61 cents which would be more than double the 30 cents and diluted EPS it reported in the previous quarter what's more we recently got news that smartphone sales in 2024 are expected to grow much better than expected last quarter sales are coming in much better but also in the smartphone market people are upgrading to higher tier phones so while the smartphone market is growing low single digits around 5% is expected in 2024 what's happening within the market is also benefiting Micron Technology as people are trading up and buying more capable smartphones more expensive smartphones with higher memory higher storage and that's great news for Micron Technology that's actually better than expected and Micron Technology already told investors that 2025 is shaping to be an excellent year and for the next several years Micron Technology is forecasting double digigit growth in the dram industry and double digigit growth in the storage industry so prospects look really really strong I don't understand the stock price decrease for Micron Technology perhaps investors are overly concerned about the capital expenditures perhaps they felt Micron Technology stock price had jumped too much remember it was up over 60% in the first half of the year and perhaps investors felt felt that was too much too quickly and so pullback was necessitated as of today August 28th Micron Technology 10 just 10 this is a valuation of a company that's expected to grow flat zero growth or 1 or 2% growth but Micron Technology is forecasting record revenues in 2025 and continued excellent Revenue growth throughout the rest of this decade so this valuation appears relatively cheap to me when comparing with other stocks available in the market so if you're wondering if this stock price decline think so and I'm reiterating my top 25 rating on Micron Technology stock today August 28th 2024 of course there are risks apparent with investing in Micron Technology stock the AI investing frenzy has taken off here in 2024 following a strong year in 2023 and in about 1 hour's time here from this recording Nvidia slated to launch their quarterly earnings release and that earnings release could do a lot for the sentiment in the stock market overall still when you look at the fundamentals of micron's business in terms of the growth drivers in revenue and profitability those prospects looks strong because of the factors I highlighted with the industries it operates in personal computers smartphones and data center artificial intelligence is infusing growth in those segments spending has already begun orders are already in and billions and billions of dollars will be spent on those products over the next few years that's almost already locked in so for all those reasons I think it's an excellent time to by Micron Technology stock on the dip
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