Does Micron's New and Improved Price Make Sense After Earnings?
Computer memory specialist Micron (NASDAQ: MU) stock surged 19.2% Thursday morning after crushing analyst forecasts for fiscal Q3 earnings.
Wall Street had expected Micron to earn $20.78 per share, adjusted for one-time items, on $35.8 billion in quarterly sales. Micron actually earned $25.11 per share, and its sales quadrupled year over year to $41.5 billion.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
GAAP earnings for the quarter weren't quite as good as the non-GAAP number noted above, but were still impressive: $24.67 per share, up 104% sequentially from Q2, and up 1,368% year over year! So Micron's not just selling more computer memory chips; it's making more profit on every chip it sells.
And perhaps most interesting to semiconductor investors here is this tidbit: Demand for memory chips isn't just driving prices higher for memory used to bolster the effectiveness of artificial intelligence chips. Price hikes are spreading across memory chips for all purposes. While chips sold through Micron's "core data center" business achieved 83% operating margins, sales of chips to automotive companies for use in cars are now earning 75% (versus just 11% a year ago) as strained capacity raises the price of chips of all sorts.
Wall Street analysts were forecasting Micron to earn $62.74 per share this year -- but that was before Micron beat earnings by $4.33. Micron's new guidance shows the company earning up to $31.73 per share in Q4; added to the $41.40 it's already earned in the first three quarters, the company's now on course to earn at least $73.13 per share this year.
On an $1,192 share price, that's a P/E ratio of only 16.3.
Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this.
On rare occasions, our expert team of analysts issues a "Double Down" stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves:
Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $516,781!*
Apple: if you invested $1,000 when we doubled down in 2008, you'd have $55,859!*
Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $387,428!*
Right now, we're issuing "Double Down" alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.
*Stock Advisor returns as of June 22, 2026
Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology. The Motley Fool has a disclosure policy.
Does Micron's New and Improved Price Make Sense After Earnings? was originally published by The Motley Fool