Feelings and facts are two different animals, what you want the stock to be and where it is now is based 'unfortunately' on facts and not 'feelings or emotions'...whatever your view is today's second news on MU are as follows for me purely as a trader I do not like to stand in front of these kind of news, specially based on 'my' asumptions which may have been suspect atleast after MU trading and making new highs..??? but people have strong opinions and they don't look for facts but believes..
Shares of Micron Technology (MU) is trading near its 52-week high after 64-Meg DRAM price moved up to $18-$20 range. Prices were hovering around $16-$17, but the earthquake in Taiwan pushed prices to almost $20. Market was already tight prior to the earthquake and now many analysts believe that supply is not likely to increase materially on a near-term basis. This bodes well for companies such as Micron whose average selling price is expected to continue to rise. Some analysts believe that 64-Meg DRAM price might have difficulty staying around $20 for too long, nonetheless, prices have rebounded enough so that MU and others would see a sharp rise in earnings going forward. Just few short months ago, DRAM prices were trading around $3.50. Despite the sharp run-up, most analysts expect MU?s earnings to be somewhat depressed this quarter since the company sold most of the DRAMs at lower prices earlier in the quarter. However, they are positive on future earnings, starting from the December quarter. In fact, Salmon Brothers raised earnings estimate and price target on MU several times over the past couple of months. Their most recent 12-month price target on MU is $120. It is also worth noting that since shares have had a strong run-up over the past few months, it would be normal to expect some pullback or consolidation within the context of its uptrend. |
