Micron Technology Stock to “Sell”, may lose money later this year; Citi Research

Micron Technology Inc may lose money later this year, according to Citi Research because of the decline in memory chip prices. The chip maker, Micron Technology stock will set to report its fiscal 3rd quarter earnings results on Tuesday.

On Sunday, an analyst Christopher Danely at Citi Research reaffirmed his “Sell” rating for Micron Technology Stock, and reaffirmed his $30 price target for Micron stock, citing the cheap memory prices.

“We expect the company to miss Consensus estimates and guide below Consensus due to the DRAM crash,” he wrote. “We also believe that there is a good chance that Micron will lose money before the end of the year given how bad the DRAM environment is.”

The analyst noted his Micron Technology Inc earnings estimate for calendar year 2020 was nearly 60% down from the average Wall Street estimate. The analysts also said that industry memory inventory was too high, and the prices of chip won’t looks to stabilize until the first half of 2020 at the most earliest.

“On the bright side, we believe that the stock is close to a bottom, so long-term investors could nibble away at it,” he wrote. “However, we are not upgrading the stock, as our rating is based on a 12-month target price, and we don’t see DRAM stabilizing until next year.”

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