Stifel Affirms Buy on Micron, $1,500 Price Target
Stifel analyst Brian Chin reiterated a Buy rating and $1,500 price target on Micron Technology (NASDAQ: MU).
“F4Q(Aug) revenue $54.2B (+31% QQ), exceeded ours/consensus ~$51B (low-20% QQ), on solid sequential bit growth and strong ASP increase despite phase-in of supply agreements (now 35%+ of revenue through CY30).
At the mid-pt, F1Q(Nov) revenue guided $61.5B (+13% QQ), above ours/cons. ~$57B.
Off record F4Q, GMs expected to decline ~70bps QQ to ~86.3%, on flow-through of higher incentive comp and fab start-up costs.
Micron expects F1Q GMs to represent a near-term floor, with revenue expected to improve each quarter and 2027 HBM price negotiation largely concluded and up “significantly” YY.
With more supply under SCAs (26 to-date), we previewed that rate-of-upside should slow and view a more neutral post-earnings stock reaction as positive.
Management sees 2027-28 conditions tighter than 2026, reflecting acceleration in demand/deceleration in bit supply growth.
F4Q FCF/sales >60%, poised to persist >50% (even on higher capex); buyback resumes in Dec. Maintain Buy and $1,500 PT (<9x NTM P/E).”
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