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Technology Stocks : Micron Only Forum
MU 234.19-2.2%Dec 3 3:59 PM EST
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To: Sridhar Srinivasan who wrote (16798)7/18/1997 3:46:00 PM
From: Peter Shaw   of 53903
 
Sridhar,
It's interesting that you keep citing the *next boom cycle* in your analysis of MU. They were experiencing huge sequential bitgrowth for the last 9 months and selling product at elevated ASP's for a portion of that time. This is not the stuff *downcycles* are made of. Especially in light of the huge sales gains made by the global boxmakers in this gogo economy (yes pockets of weakness globally are apparent in Japan and Europe). Now MU is trading at historical highs on a price/cashflow basis, and has acquired a large debt burden in order to finance their future development. Bitgrowth is slowing and the possible impacts of Y2k and discounted expectations of a PC demand pickup going into Fall are all creating big hurdles going forwards.
What are you basing this boom prediction on? The conditions which created MU's big runnup to the 90's involved lack of capacity for the explosion in PC memory demand spurred on by a wave of *killer apps*. The reverse conditions seem to be in place. Semi demand will explode in 1998, but different segments of the market will realize different levels of growth. DSP's and ASIC's seem to be the big growers going forwards, while capacity slowly whittles down in the memory market in the face of moderate growth rates.
I like the fact that MU is diversifying, and leading the way to 256 Mb. It still will not support the valuations we are seeing indefinitely, however. Right now the trend is up, and the stock looks quite strong to me. Larry's right...this is a great stock to day trade!!!

Cheers,

Peter Shaw
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