Micron Technology Inc. (NASDAQ:MU) stock was down about 2% in Thursday’s premarket trading as investors reduced exposure to large-cap technology and semiconductor stocks.
Nasdaq futures fell 0.21%, while S&P 500 futures slipped 0.04%. The decline appeared to reflect broader weakness in technology stocks and profit-taking after Micron’s strong rally over the past year.
The softer futures market weighed on higher-beta chip stocks before the opening bell. Micron remains well above its longer-term trend levels, but investors have become more cautious following signs that the stock’s recent momentum has slowed.
The pullback also came as investors weighed intensifying competition in the memory-chip market. Sentiment weakened following reports that Chinese memory maker ChangXin Memory Technologies (CXMT) is preparing an $8.55 billion initial public offering, while rivals Samsung Electronics Co., Ltd. (OTC:SSNLF) and SK hynix Inc. (NASDAQ:SKHY) continue expanding memory production capacity. Those developments have added to concerns about the industry’s longer-term supply outlook.
Cash Flow Outlook Draws Bullish View
Alger Executive Vice President Ankur Crawford said Wednesday that Micron’s earnings power remains underappreciated. Crawford said that if she were buying just one stock right now, it would be Micron.
Speaking on CNBC, Crawford said the company could generate cash flow equivalent to roughly 30% of its current market capitalization over the next 18 months and as much as 50% over a longer period.
She attributed that outlook to persistent shortages in high-end DRAM, which continue to support pricing. Although China could eventually emerge as a larger competitor in memory, Crawford said she does not expect that risk to materially affect the market until 2029 or 2030.
She added that investors are prematurely assuming the memory cycle is nearing its peak, arguing that supply constraints could keep earnings growing into 2027 or 2028.
Technical Picture Remains Mixed
Micron continues to trade in a long-term uptrend. The stock is 31.4% above its 100-day simple moving average and 86.2% above its 200-day average.
However, shares have fallen 14.9% below the 20-day moving average and 4% below the 50-day moving average. That suggests the stock is experiencing a short-term pullback within a broader bullish trend.
The moving averages remain in a positive alignment, with the 20-day average above the 50-day average and the 50-day average above the 200-day average. Still, the stock is trading below its shorter-term averages, indicating buyers have become more selective.
Momentum indicators also point to cooling strength. The MACD remains below its signal line, suggesting upside momentum has weakened.
A key support level sits near $854.50. A break below that level could increase selling pressure.
Earnings And Analyst Outlook
Wall Street expects Micron to report quarterly results around Sept. 22.
Analysts project earnings of $31.24 per share, up sharply from $3.03 a year earlier. Revenue is expected to increase to $50.72 billion from $11.31 billion.
The stock carries a consensus Buy rating with an average price target of $1,548.86. Recent analyst actions include:
- KeyBanc raised its price target to $1,750 and maintained an Overweight rating on July 14.
- Cantor Fitzgerald raised its price target to $2,000 and maintained an Overweight rating on June 29.
- Cantor Fitzgerald maintained its Overweight rating and $1,500 price target on June 25.
ETF Exposure
Micron is a significant holding in several semiconductor-focused exchange-traded funds, including the iShares Semiconductor ETF (NASDAQ:SOXX), the Invesco S&P 500 Momentum ETF (NYSE:SPMO), and the Invesco PHLX Semiconductor ETF (NASDAQ:SOXQ).
As a result, strong inflows or outflows in those funds can affect demand for Micron shares.
MU Stock Price Activity: Micron Technology shares were down 1.97% at $886.45 during premarket trading on Thursday, according to Benzinga Pro data.
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