MU

Quick Update for MU Investors

Today we're going to take a closer look at large-cap Technology company Micron Technology, whose shares are currently trading at $67.97. We've been asking ourselves whether the company is under or over valued at today's prices... let's perform a brief value analysis to find out!

Trades Below Its Graham Number but Has an Elevated P/E Ratio:

Micron Technology, Inc. designs, develops, manufactures, and sells memory and storage products worldwide. The company belongs to the Technology sector, which has an average price to earnings (P/E) ratio of 27.16 and an average price to book (P/B) ratio of 6.23. In contrast, Micron Technology has a trailing 12 month P/E ratio of -25.7 and a P/B ratio of 1.64.

Micron Technology's PEG ratio is 6.41, which shows that the stock is probably overvalued in terms of its estimated growth. For reference, a PEG ratio near or below 1 is a potential signal that a company is undervalued.

The Company Has a Positive Net Current Asset Value:

2017-10-26 2018-10-15 2019-10-17 2020-10-19 2021-10-08 2022-10-07
Revenue (MM) $20,322 $30,391 $23,406 $21,435 $27,705 $30,758
Gross Margins 42.0% 59.0% 46.0% 31.0% 38.0% 45.0%
Operating Margins 28% 49% 32% 14% 23% 32%
Net Margins 25.0% 47.0% 27.0% 13.0% 21.0% 28.0%
Net Income (MM) $5,089 $14,135 $6,313 $2,687 $5,861 $8,687
Net Interest Expense (MM) -$560 -$222 $77 -$80 -$146 -$93
Depreciation & Amort. (MM) -$3,861 -$4,759 -$5,424 -$5,650 -$6,214 -$7,116
Earnings Per Share $4.41 $11.5 $5.52 $2.38 $5.14 $7.74
EPS Growth n/a 160.77% -52.0% -56.88% 115.97% 50.58%
Diluted Shares (MM) 1,154 1,229 1,143 1,131 1,141 1,122
Free Cash Flow (MM) $12,887 $26,279 $22,969 $16,529 $22,498 $26,360
Capital Expenditures (MM) -$4,734 -$8,879 -$9,780 -$8,223 -$10,030 -$11,179
Net Current Assets (MM) -$3,409 $5,924 $4,484 $3,283 $4,991 $5,405
Long Term Debt (MM) $9,893 $3,780 $4,541 $6,373 $6,621 $6,803
Net Debt / EBITDA 0.59 -0.11 -0.16 -0.17 -0.15 -0.14

Micron Technology has weak revenue growth and a flat capital expenditure trend, average net margins with a stable trend, and irregular cash flows. We also note that the company benefits from an excellent current ratio and low leverage. However, the firm suffers from slimmer gross margins than its peers and declining EPS growth.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.

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