Savvy Trades and Investments

[cliffvb]

MU has been strong over the last month or so, helped by continued higher Dram chip prices.Now pundits expect high prices to continue for at least the next year. Growth in demand is expected to outstrip supply even with planned expansions. I expect MU to nicely beat analyst Q4 earning estimate of $1.82 when earnings come out next week.

The upbeat views keep coming for Micron Technology ( MU), with Deutsche Bank'sSidney Ho this morning reiterating a Buy rating on the stock, and raising his price target to $42 from $37, after concluding prices are holding up better than expected in advance of the company's fiscal Q4 report, next Tuesday, September 26th.
Ho's is just the latest in a series of positive notes on Micron, including one yesterday from Susquehanna Financial Group and one on Monday from Evercore ISI.
"While near term strength is mostly anticipated, we believe investors continue to underestimate the staying power of the current cycle especially for DRAM," writes Ho.
Furthermore, "We believe disciplined capex by memory suppliers will prolong this upcycle, and we will continue to monitor industry supply that could disrupt the market."
"Based on our recent research and comments at our tech conference, we now expect both DRAM and NAND ASPs to increase 2-3% q/q, vs. our prior estimates of down 4-5% q/q," writes Ho.
Ho is now modeling Micron beating estimates on Tuesday and also the next quarter, reporting $1.90 per share, versus consensus for $1.82. He also raises his outlook for Q1 to $6.3 billion in revenue and $2.05 per share, up from his prior forecast of $5.95 billion and $1.71, and higher than consensus for $6 billion and $1.77.
Ho notes Micron's capital spending will probably rise from about $5 billion this fiscal year to $6 billion to $7 billion next year.
Micron shares are down 37 cents, or 1%, at $35.58.
More at Barron's Tech Trader Daily blog, http://www.barrons.com/tech-trader