--> Shares of MU are trading down approx 3% in pre--market trade; shares are showing some signs of holding the $16.85 area.
Micron: Color on Qtr
- Stifel Research notes Micron delivered a solid beat to August-ending quarter estimates. Clearly, the DRAM market is in recovery mode following a 2 year period of declining prices. Micron has also firmly established its 3D NAND production with management pointing to over 50% of the company's NAND output to be 3D during the November quarter. November quarter revenue guidance beat estimates with ASPs rising and increasing demand. Non-GAAP EPS guidance, though, has some controversy. Firm believes this change is reasonable but does suggest that management's non-GAAP EPS guidance for $0.13 - $0.21 excluding SBC (~0.05/share) missed consensus estimate for $0.09. The MU shares may be weaker due to this miss. Stifel would be buyers on the weakness as it believes, Micron's up-cycle is only beginning.
- Mizuho Securities notes MU reported AugQ above consensus and guided NovQ EPS to $0.13-0.21, well above the $0.09 consensus. NovQ GM was guided to 23-25.5%, well above 21.6% consensus; but excluding a 200bps benefit from lower deprecation the guide was inline, which may be a disappointment. Topline growth and bit growth are accelerating, the industry is supply constrained in DRAM and NAND, and the Inotera deal should close in the Dec Q, which should all drive more GM improvement.Raising estimates and PT to $22.