Micron Expertise 2Q Preview: This Analyst Expects Income Upside, Margin Stress – Micron Expertise (NASDAQ:MU)

Micron Expertise Inc MU is scheduled to report its fiscal second-quarter earnings on Thursday.

Whereas the corporate is more likely to report its quarterly outcomes broadly in-line with expectations, there’s “some potential income upside, however some danger to margins,” in accordance with RBC Capital Markets.

The Micron Expertise Analyst: Analyst Matt Bryson reaffirmed an Outperform score and worth goal of $125.

The Micron Expertise Thesis: Softer DRAM and NAND pricing at first of this yr might push the corporate’s margins into the decrease half of the fiscal second-quarter steerage vary, Bryson mentioned within the be aware.

Take a look at different analyst inventory scores.

Micron Expertise had instructed that its sequential income development 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 combination shift in the direction of decrease margin components that might trigger margins to contract by a “few hundred bps.”

“With our mannequin already considering a 260 bps dip in GMs and a modest carry in revenues, we see some potential once more MU is ready to mission income upside vs. our estimates, but additionally with extra modest margins vs. our expectations,” Bryson additional wrote.

Worth Motion: Shares of Micron Expertise had risen by 0.38% to $102.10 on the time of publication on Wednesday.

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