Four straight days of declines. What Micron is losing isn’t earnings—it’s pricing power.
On October 13, it closed at 953.19, down 3.62%—its fourth consecutive down day and its lowest close since September 16. It’s now fallen nearly a quarter from its June 25 high of 1255.
The trigger was ChangXin Memory Technologies (CXMT) announcing progress on its 4F² DRAM architecture and plans to launch server memory products by year-end. Samsung, SK hynix, and Micron account for roughly 90% of global DRAM market share. This news threatens their pricing power, not Micron’s own financial results.
That same week, Samsung’s third-quarter profit forecast also came in below market expectations, bringing the question “Can memory price hikes continue?” into focus for the first time.
The fundamentals haven’t actually deteriorated: Q4 revenue and profit both beat expectations, with next-quarter guidance of $61.5 billion in revenue / $38.15 EPS. It has $68.3 billion in net cash on its balance sheet and has also approved $35.16 billion in share repurchases, set to begin on December 9.
But for cyclical stocks, the most expensive moment is often when earnings look their best.
The bias is bearish, but don’t chase it. At a current price of around 944.82, consider short entries on a rebound at 1000–1020, 1070–1090, and 1140–1160. Stop-loss at 1210; first target at 850.
After a quarter of declines, chasing the short is just paying a premium for emotion.
$MU
On October 13, it closed at 953.19, down 3.62%—its fourth consecutive down day and its lowest close since September 16. It’s now fallen nearly a quarter from its June 25 high of 1255.
The trigger was ChangXin Memory Technologies (CXMT) announcing progress on its 4F² DRAM architecture and plans to launch server memory products by year-end. Samsung, SK hynix, and Micron account for roughly 90% of global DRAM market share. This news threatens their pricing power, not Micron’s own financial results.
That same week, Samsung’s third-quarter profit forecast also came in below market expectations, bringing the question “Can memory price hikes continue?” into focus for the first time.
The fundamentals haven’t actually deteriorated: Q4 revenue and profit both beat expectations, with next-quarter guidance of $61.5 billion in revenue / $38.15 EPS. It has $68.3 billion in net cash on its balance sheet and has also approved $35.16 billion in share repurchases, set to begin on December 9.
But for cyclical stocks, the most expensive moment is often when earnings look their best.
The bias is bearish, but don’t chase it. At a current price of around 944.82, consider short entries on a rebound at 1000–1020, 1070–1090, and 1140–1160. Stop-loss at 1210; first target at 850.
After a quarter of declines, chasing the short is just paying a premium for emotion.
$MU