Quick reading
Micron (MU) trades at nearly 4 times forward earnings after a 256% revenue surge, but record investments at peak margins mirror past highs.
Manish Bhatia says more than 75% of FY2027 shipments are committed, but admits that “we really don’t have visibility on when supply and demand will balance out.”
Micron’s shift from a profit in fiscal 2022 to a loss in fiscal 2023 shows how quickly margins can reverse once prices cool.
Read more: Discover 7 Ways to Generate Income with a $1,000,000+ Portfolio (Sponsor)
Micron technology (NASDAQ:MU) is trading at $733.15. A 28.74% month-on-month decline shows that investors are already doubtful that the price of AI memory can remain at record highs.
Micron makes DRAM, NAND, and high-bandwidth memories (HBM), the stacked chips that power AI accelerators. Fiscal 2026 revenue reached $133.188 billion, up 256.33%, and fourth-quarter non-GAAP gross margin reached 87.0% from 45.7% a year earlier.
Bulls argued that multi-year strategic customer agreements transformed a commodity business into a contract business. Shares are now about 41.6% below their 52-week high of $1,254.61, sparking a fierce online debate over whether the stock is cheap.
Long-term profit four times higher with committed shipments
Micron trades at a forward P/E of around 4x, a trailing P/E of 9, and a PEG ratio of 0.16. FY2027 EPS estimates average $176.5017, with 29 upward versus 2 downward revisions over 30 days.
First-quarter guidance calls for revenue of $61.5 billion and non-GAAP EPS of $38.15. Chairman Manish Bhatia said more than 75% of fiscal 2027 shipments were committed, adding: “We really have no visibility on when supply and demand will balance out.” HBM4E, co-designed with Nvidia (NASDAQ:NVDA), targets volume production for the year 2027.
Record investments at maximum margins mark record highs in memory
Investments increased from $15.857 billion to $30.712 billion in FY 2026. Micron has seen it before: net profit of $8.687 billion for FY 2022 became a loss of $5.833 billion for FY 2023.
——
Discover 7 Ways to Generate Income with a $1,000,000+ Portfolio
If you have saved more than $1,000,000, this guide is for you. The last thing you want in retirement is to run out of money. You want your money to generate sustainable income while you enjoy life.
Now you can learn about the strategies wealthy retirees use to fund their retirement with the Definitive Guide to Retirement Income from Fisher Investments. Download the guide today! (sponsor)
——
Chief Financial Officer Mark Murphy said that “eventually, price increases would moderate”. Mobile and client bits declined sequentially, while prices generated revenue. About three-quarters of deal revenue is in pricing models, and most of those have caps that cap upside. A single-digit multiple on maximum profits is the classic cyclical trap.
Gn bussni
