Micron Know-how Inc MU is scheduled to report its fiscal second-quarter earnings on Thursday.
Whereas the corporate is prone to report its quarterly outcomes broadly in-line with expectations, there’s “some potential income upside, however some danger to margins,” based on RBC Capital Markets.
The Micron Know-how Analyst: Analyst Matt Bryson reaffirmed an Outperform ranking and worth goal of $125.
The Micron Know-how Thesis: Softer DRAM and NAND pricing to start with of this yr may push the corporate’s margins into the decrease half of the fiscal second-quarter steering vary, Bryson stated within the observe.
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Micron Know-how had steered that its sequential income progress within the fiscal third quarter could also be boosted by improved cargo ranges, with a rebound in shopper demand and normalization of buyer stock ranges, the analyst said.
He added, nonetheless, that the corporate expects this to trigger a mixture shift in direction of decrease margin components that would trigger margins to contract by a “few hundred bps.”
“With our mannequin already considering a 260 bps dip in GMs and a modest elevate in revenues, we see some potential once more MU is ready to challenge income upside vs. our estimates, but in addition with extra modest margins vs. our expectations,” Bryson additional wrote.
Worth Motion: Shares of Micron Know-how had risen by 0.38% to $102.10 on the time of publication on Wednesday.
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Momentum78.10
Progress70.90
High quality76.14
Worth58.67
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