We believe a good deal of negativity has been priced into tech stocks, like Micron (MU)
Notice what has happened historically when MU hits its lower Bollinger Band (2,20) and Williams’ %R (W%R) dips below its 80-line. Not long after the stock begins to pivot and move in the opposite direction.
Of the tech stocks mentioned, we like Micron Technology (MU).
Trading with a PEG ratio of just 0.15, Micron Technology, Inc. provides semiconductor systems worldwide. The company operates through four segments: Compute and Networking Business Unit, Storage Business Unit, Mobile Business Unit, and Embedded Business Unit. It offers DDR3 and DDR4 DRAM products for computers, servers, networking devices, communications equipment, consumer electronics, automotive, and industrial applications; lower power DRAM products for smartphones, tablets, automotive, laptop computers, and other mobile consumer device applications; DDR2 DRAM and DDR DRAM, GDDR5 and GDDR5X DRAM, SDRAM, and RLDRAM products for networking devices, servers, consumer electronics, communications equipment, computer peripherals, and automotive and industrial applications, as well as for computer memory upgrades; and hybrid memory cube semiconductor memory devices.
In its latest quarter, the company posted revenues of $7.35 billion, up 58% since the same period last year. Analysts had forecast $7.28 billion, so Micron beat by $70 million. With EPS analysts expected $2.74. The company posted $2.82.
Despite such positive news, the stock pulled back.
And many analysts have had mixed opinion. Citigroup for example downgraded the stock from a buy rating to a neutral rating, suggesting that they had “some concern on Micron stock for a few months” and is particularly nervous that NAND demand may be ‘rolling over.”
However, Cowen analyst rejected that idea, raising its target price on MU from $55 to $65.
There are two ways to trade MU here.
One, buy the stock at market prices… And, or buy to open the MU May 18, 2018 55 calls.
