Micron Technology Shares Rise Amid Optimism for Demand, Prices
Bloomberg News
January 7, 1999, 9:13 a.m. PT
Micron Technology Shares Rise Amid Optimism for Demand, Prices
Boise, Idaho, Jan. 7 (Bloomberg) -- Shares of Micron
Technology Inc., one of the biggest makers of computer-memory
chips, rose as much as 11 percent amid optimism for strong demand
and more stable prices for its products.
Micron rose 5 1/2 to 65 1/8 in midday trading as 5.49
million shares changed hands. Earlier, the shares touched 66 3/8,
their highest in more than three years. The stock has surged 33
percent since Monday.
The rosy outlook is a far cry from 1998, when prices for
dynamic random-access memory chips plummeted almost 70 percent
because of excess supply and lackluster personal-computer demand.
Now, many chipmakers have scaled back production, fourth-quarter
PC shipments are expected to have been strong, and prices have
stopped their rapid decline.
''We believe the DRAM recovery is already under way,'' said
Bhabin Chah, an analyst at CS First Boston, on a conference call
with customers this morning. ''We expect very moderate, if any,
price decline in first half 1999.''
Memory-chip companies got hammered when PC makers built too
many machines early last year and then scaled back plans for new
production, resulting in delayed or canceled orders. Now, Boise,
Idaho-based Micron has been able to raise prices on some products
and PCs were hot sellers in the holiday sales season.
''The fourth quarter looks like it was good and demand
continues to be good in the first quarter,'' said analyst Jack
Geraghty of Gerard Klauer Mattison Inc., who rates Micron
''buy.'' |
