Micron(MU:NSD) Morgan Stanley raises target on upward estimate revisions

STA Research
by: STA Research

Today Morgan Stanley analyst, Joseph Moore  lifted his target on Micron to $63 from $52.50 and kept his Overweight rating on the stock.
Micron’s Relative Strength rating was upgraded today to 82 from 79, giving the stock a strong technical boost, and the stock is ranked number 5 in it’s industry.

Micron Technology is expected to release its next quarterly numbers on  June 25th, 2020. Coming into earnings, Micron’s outlook is improving immensely reflecting the stock’s recent strong price movement.  Analyst’s believe the stock should carry on it’s upside trajectory as earnings estimates are being bumped higher. The upward movement in estimate revisions for this chipmaker demonstrates the growing optimism by analysts on the company’s upcoming earnings report.

STA Research(stocktargetadvisor) has a average target of $61.50 on the stock, and a consensus Strong Buy rating. STA’s view of the stock is Bullish with a score of 8.8 out of 10, where 0 is very bearish and 10 very bullish.

What to like:
High market capitalization
This is one of the largest entities in its sector and is among the top quartile. Such companies tend to be more stable.
Underpriced compared to book value
The stock is trading low compared to its peers on a price to book value basis and is in the top quartile. It may be underpriced but do check its financial performance to make sure there is no specific reason.
Superior capital utilization
The company management has delivered better return on invested capital in the most recent 4 quarters than its peers, placing it in the top quartile.
Low debt
The company is less leveraged than its peers , and is among the top quartile, which makes it more flexible. However, do check the news and look at its sector. Sometimes this is low because the company is not growing and has no growth potential.
Positive cash flow
The company had positive total cash flow in the most recent four quarters.
Positive free cash flow
The company had positive total free cash flow in the most recent four quarters.
Underpriced on free cash flow basis
The stock is trading low compared to its peers on a price to free cash flow basis and is in the top quartile. It may be underpriced but do check its financial
performance to make sure there is no specific reason.

What to not like:
High volatility
The total returns for this company are volatile and above median for its sector over the past 5 years. Make sure you have the risk tolerance for investing in such stock.

 

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