06-27-2017, 01:33 PM
Micron’s earnings are directly proportional to DRAM ASPs since Micron earns more than 60.0% of its revenue from DRAM. Many industry experts expected DRAM ASP to fall in 2Q17 as seasonal PC demand faded, thereby affecting Micron’s margins. So analysts lowered their ratings and price targets for MU stock.
Has Micron Technology Reached the Peak of Its Memory Cycle? - Market Realist
According to DRAMeXchange, PC (personal computer) DRAM prices were flat in April 2017. Average contract prices for server DRAM rose 10.0% in 2Q17. DRAMeXchange said that April and May are seasonally weak months for the DRAM market as the demand from the Chinese New Year fades and the next demand growth from the back-to-school season hasn’t picked up yet. The second half of the year is seasonally strong for DRAM since several OEMs (original equipment manufacturers) stock up inventory in preparation for the holiday season. Many semiconductor analysts expect DRAM prices to continue to rise throughout 2017 since they expect demand to continue to surpass supply.
Has Micron Technology Reached the Peak of Its Memory Cycle? - Market Realist
Micron will report a blowout quarter as the street expects it to. "Micron's management needs to raise its forecast enough to convince people that its business still hasn't reached saturation," added Cramer.
Game Plan For The Week - Cramer's Mad Money (6/23/17) | Seeking Alpha