1 week ago
4
David Jagielski, CPA, The Motley Fool
Mon, April 27, 2026 astatine 9:20 AM CDT 3 min read
Micron Technology (NASDAQ: MU) has been generating immoderate genuinely spectacular quarterly results owed to unthinkable request for its representation and retention products. Both its apical and bottommost lines person looked astonishing successful caller quarters, making it small astonishment wherefore this tech banal has been rallying arsenic overmuch arsenic it has. In the past 12 months, it has skyrocketed implicit 540% heading into trading this week.
As agelong arsenic request remains robust, the banal whitethorn person adjacent much country to run. But determination whitethorn beryllium occupation connected the horizon, arsenic a caller forecast suggests that a slowdown successful Micron's awesome maturation complaint whitethorn beryllium coming, and it's apt to beryllium significant. And that could pb to the marketplace adjusting what benignant of premium it's consenting to wage for the stock.
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In its astir caller quarter, which ended connected Feb. 26, Micron's income totaled $23.9 billion, which was astir 3 times the $8.1 cardinal it reported successful the aforesaid play a twelvemonth ago. With that benignant of growth, it's inevitable that the concern volition acquisition a slowdown, fixed the challenges of maintaining that gait successful the agelong term.
But analysts person mostly been reasonably bullish connected the stock, with Micron trading astatine a guardant price-to-earnings (P/E) aggregate of little than nine. That implies a beardown magnitude of nett maturation for the twelvemonth ahead, suggesting that the banal is inactive incredibly cheap.
And portion the adjacent aboriginal does look encouraging, it whitethorn beryllium a substance of clip earlier proviso catches up with demand, prices for products travel down, and it becomes much challenging for Micron's concern to turn astatine a beardown rate. In 2027, analysts task that Micron's gross volition emergence by 33%, but that successful 2028 its apical enactment volition diminution by 10%. For maturation investors, that could beryllium a crushed to worth the banal astatine a little P/E multiple, hence the seemingly debased terms for Micron's stock.
Micron's banal has risen sharply successful a abbreviated time, which tin rise the hazard of a correction if marketplace sentiment sours connected tech oregon if tech giants denote spending cuts. For the clip being, Micron's banal whitethorn inactive bash good fixed the ongoing shortage successful representation and retention products. However, the forecast of a slowdown successful 2028 highlights the imaginable for utmost volatility up for Micron, arsenic investors whitethorn statesman to terms successful that decline.
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