MU - Embedded Expectations Analysis - 2020 11 13
Micron Technology, Inc. (MU:USA) is currently trading below corporate averages relative to UAFRS-based (Uniform) earnings, with a 10.7x Uniform P/E. At these levels, the market is pricing in bearish expectations for the firm, and management may have concerns about continued revenue decline, their ability to meet EPS guidance, and their Huawei relationshipSpecifically, management may lack confidence in their ability to mitigate revenue declines, get financially stronger, and recover by the end of Q4. Moreover, they may be concerned about holding high levels of raw materials and weak enterprise demand. In addition, they may have concerns about their rising net interest expense, the sustainability of Huawei's demand, and U.S. shipment restrictions on Huawei. Furthermore, they may lack confidence in their ability to do another partnership with Huawei, meet their EPS guidance, and sustain Quad-level cell (QLC) growth. Finally, management may have concerns about the sustainability of the data center market as a growth engine
Micron Technology provides memory and storage solutions. The company's portfolio of memory and storage technologies include Dynamic Random Access Memory, Not And, 3D XPoint? memory, and Not Or. The company's segments are: Compute and Networking Business, which includes memory products sold into client, cloud server, enterprise, graphics, and networking markets; Mobile Business, which includes memory products sold into smartphone and other mobile-device markets; Storage Business, which includes Solid-State Drives and component-level solutions sold into enterprise and cloud, client, and consumer storage markets; and Embedded Business, which includes memory and storage products.
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