Micron Technology Inc. (NASDAQ:MU) stock fell more than 1% in premarket trading Wednesday as investors took profits in semiconductor stocks following a strong multi-month rally.
The decline came despite a positive broader market backdrop. Nasdaq futures rose 0.5%, while S&P 500 futures gained 0.2%.
The stock has posted strong gains over the past 12 months and remains in a longer-term uptrend despite recent weakness. Investors are also watching whether the shares can regain short-term momentum after pulling back from recent highs.
Technical Levels Remain In Focus
Micron is trading about 7.3% below its 20-day simple moving average of $1,050.69. However, the stock remains 6.2% above its 50-day SMA of $916.74 and more than 100% above its 200-day SMA of $472.44.
The relative strength index stands at 50.12, indicating neutral momentum. The reading suggests the stock has cooled from its previously overbought levels and is now consolidating.
The next key resistance level is near $1,089.50. Support is around $891.50, close to the 50-day moving average, where buyers may step in if selling pressure increases.
Earnings Expectations Stay Strong
Wall Street expects Micron to report its next quarterly results around Sept. 22.
Analysts forecast earnings of $31.24 per share, up from $3.03 a year earlier. Revenue is expected to increase to $50.72 billion from $11.31 billion.
The stock trades at about 22.2 times earnings.
Analysts maintain a consensus Buy rating with an average price forecast of $1,548.86. Recent analyst actions include:
- KeyBanc raised its price forecast to $1,750 on July 14 while maintaining an Overweight rating.
- Cantor Fitzgerald raised its price forecast to $2,000 on June 29 and reiterated its Overweight rating.
- Cantor Fitzgerald maintained its Overweight rating with a $1,500 price forecast on June 25.
Benzinga Edge Ratings
According to Benzinga Edge, Micron scores highly on momentum, quality and growth, while its value score remains relatively weak.
The momentum score of 99.67 reflects the stock’s strong longer-term trend. Quality scored 97.71, while growth came in at 84.75. The value score was 27.67, suggesting the shares trade at a richer valuation than many peers.
ETF Ownership Remains Significant
Micron is a major holding in several semiconductor-focused exchange-traded funds.
The stock represents about 8.03% of the iShares Semiconductor ETF (NASDAQ:SOXX), 8.39% of the Invesco S&P 500 Momentum ETF (NYSE:SPMO) and 9.78% of the Invesco PHLX Semiconductor ETF (NASDAQ:SOXQ).
Because of those weightings, fund inflows and outflows can influence trading activity in Micron shares.
Price Action
MU Stock Price Activity: Micron Technology shares were down 1.11% at $972.20 during premarket trading on Wednesday, according to Benzinga Pro data.
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