- Micron and other memory chip stocks have cooled recently, after an incredible surge last year and into this year.
- Micron is scheduled to report its second-quarter earnings on March 18; analysts expect sales to rise 137% and adjusted profit to rise 450%.
- Micron will be included in the S&P 100 index, effective March 23.
Even as the surge in memory stocks has cooled recently, Micron Technology drew fresh buzz on Sunday, with retail traders discussing positions ahead of the chipmaker’s inclusion in the S&P 500 index and its upcoming earnings report next week.
The S&P 500 announced Friday that Micron’s inclusion in the index is effective March 23. Lam Research, Applied Materials, and GE Vernova will also be added. Inclusion in the S&P 100, a subset of the S&P 500 that tends to be the largest and most established companies in the index, often triggers buying by large funds mandated to track the benchmark.
Meanwhile, traders are upbeat about Micron’s earnings report on March 18, which comes amid surging demand for memory chips driven chiefly by data center operators, leading to shortages and higher prices due to the supply-demand imbalance.
Analysts expect sales to rise by a whopping 137% to $19.07 billion, while adjusted profit is expected to rise 450% to $8.58 per share, according to consensus estimates from Koyfin.
Retail’s View On Micron
$MU Inclusion into S&P 100. Upcoming earnings--will crush it,” said a user. Bullish all the way.”
“$MU take advantage of the dip. The DRAM shortage will just be worse because of Donald's stupidity,” another said, referring to the U.S. President’s military offensive in Iran that is fanning risks of fresh trade and logistical disruptions.
Stocktwits sentiment for MU shifted to ‘neutral’ from ‘bearish,’ although some skepticism remained. The main amongst them was volatility in the South Korean stock market, home to memory giants Samsung and SK Hynix, which sparked a wave of risk-off sentiment that hit U.S. memory firms earlier this week.
Some Traders Are Skeptical Too
CNBC’s Jim Cramer warned earlier this week about “South Korean spillover into our markets,” naming Micron among stocks he called “all still vulnerable.”.
Meanwhile, Nvidia has selected Samsung and SK Hynix as the sole suppliers of high-bandwidth memory (HBM4) for its next flagship AI accelerator, Vera Rubin, according to a report in The Korea Economic Daily on Sunday. The move sidelines supplier Micron from the upcoming product cycle, the report said.
“$MU thank god I took profits,” said a user.
Micron is among the chief beneficiaries of the memory shortages, which pushed its stock 240% higher over the last year. Despite the recent retreat, Micron shares are still 30% up year to date.
“We expect fully sold out of memory and positive guidance for the unforeseeable future,” said a retail trader. “Even once the AI buildout is complete, new memory is needed, so this is why they just (got) included them in the S&P 100. No company gets accepted into this w/o long term business model expected to surpass expectations. Set up will be massive! Very positive.”
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