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Micron (MU) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, Micron (MU - Free Report) closed at $70.21, marking a -0.64% move from the previous day. This change lagged the S&P 500's daily loss of 0.22%. Elsewhere, the Dow lost 0.23%, while the tech-heavy Nasdaq lost 0.38%.

Coming into today, shares of the chipmaker had gained 10.25% in the past month. In that same time, the Computer and Technology sector gained 5.2%, while the S&P 500 gained 2.78%.

MU will be looking to display strength as it nears its next earnings release, which is expected to be January 7, 2021. On that day, MU is projected to report earnings of $0.71 per share, which would represent year-over-year growth of 47.92%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.73 billion, up 11.38% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.66 per share and revenue of $24.17 billion. These totals would mark changes of +29.33% and +12.76%, respectively, from last year.

Any recent changes to analyst estimates for MU should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 36.35% higher. MU currently has a Zacks Rank of #1 (Strong Buy).

Looking at its valuation, MU is holding a Forward P/E ratio of 19.28. This represents a no noticeable deviation compared to its industry's average Forward P/E of 19.28.

Investors should also note that MU has a PEG ratio of 1.56 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Semiconductor Memory stocks are, on average, holding a PEG ratio of 1.56 based on yesterday's closing prices.

The Semiconductor Memory industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 1, which puts it in the top 1% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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