Micron Technology, Inc. (MU) interests rose more than 8% during Thursday’s session after the company reported better-than-expected second place financial results. Revenue fell 20.5% to $5.84 billion, beating consensus estimates by $20 million, and non-GAAP net gains reached $1.71 per share, beating consensus estimates by five cents per share.
While falling DRAM rewards have taken a toll on revenue, the company cut its capital expenditure plans, and inventories have been depleting at a immorally rate. Management predicts that DRAM prices will improve by the fourth quarter along with NAND values in the first quarter. The company also indicated that it would continue to reinvest half of its free cash swirl (FCF) into repurchases.
Analysts have mixed opinions following the financial results. Citi analyst Christopher Danely inclination on the waned Micron stock from Neutral to Sell, saying that “you can’t swim against a tsunami,” even though Micron is bothersome its best. However, Rosenblatt analyst Hans Mosesmann reiterated his Buy rating and $75.00 price target, saying that the hustle cycle will bottom this year and that the company will come out ahead in the end.
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From a complicated standpoint, the stock broke down from trendline support in late February before bottoming in mid-March and retesting its on a trips following Q2 financial results. The relative strength index (RSI) is moving toward overbought levels with a reading of 67.04, but the unstationary average convergence divergence (MACD) could see a near-term bullish crossover. These indicators suggest that the heritage could see some consolidation before a move higher.
Traders should watch for a breakout from trendline, 200-day in motion average and R1 resistance near $44.13 toward trendline and R2 resistance at $47.37. If the stock fails to break out, traders should be vigilant for for some consolidation between R1 resistance at $44.13 and pivot point support at $40.74 before another attempt record. A breakdown from the pivot point could lead to a retest of S1 support at $37.50.
The author holds no position in the stock(s) mentioned except because of passively managed index funds.