Source: Wall Street Journal

After the US-China trade negotiations reached a consensus on "stopping the war" over the weekend, Micron Technology released another impressive financial report on Monday, announced the approval of a $10 billion stock repurchase plan, and reached a cooperation agreement with Intel. Boosted by this, Micron Technology's stock price rebounded sharply, with a cumulative increase of 35% this year.

Monday was clearly a good day for Micron Technology, the star chip stock and the largest memory chip maker in the United States.

After the China-U.S. economic and trade consultations over the weekend reached a consensus on "not engaging in a trade war", Micron Technology released another impressive financial report on Monday, announcing the approval of a $10 billion stock repurchase plan and a cooperation agreement with Intel. Boosted by this, Micron Technology's stock price rebounded sharply.

In after-hours trading, Micron Technology announced that it had reached an agreement with fellow chip giant Intel to jointly develop next-generation chips for flash drives and digital cameras. Subsequently, the company announced that it would repurchase $10 billion of its own stock.

Micron Technology raised its third-quarter outlook in its financial report, now expecting earnings per share of $3.12 to $3.16 and revenue of $7.7 billion to $7.8 billion, higher than its previous expectations of earnings per share of $2.76 to $2.9 and revenue of $7.2 billion to $7.6 billion, respectively.

Analysts surveyed by FactSet, on average, expected earnings of $2.86 per share on revenue of $7.49 billion.

In this regard, Sanjay Mehrotra, president and CEO of Micron Technology from India, explained in the financial report: "The reason for raising the third quarter performance expectations is mainly due to the implementation of our strategy against the background of healthy development of the fundamentals of the entire chip industry."

Micron Technology opened sharply higher on Monday, up more than 5.4% and closed up 3.91%. After the market closed, the stock rose further by 3.46% to $57.40. The stock has risen 35% this year.

A Wall Street analyst said last week that if investors want to benefit from the long-term growth of the chip industry, then Micron Technology is a good way. RBC Capital Markets analyst Amit Daryanani said:

Micron Technology offers investors a unique way to gain exposure to the DRAM (dynamic random access memory) and NAND (computer flash memory) markets, and we believe the stock is also trading at an attractive valuation.

Amit Daryanani is not the only one who is bullish on Micron Technology.

According to the SEC's 13F position disclosure documents, hedge fund Coatue Management bought 14.5 million shares of Micron Technology in the first quarter. Appaloosa, led by David Tepper, and Duquesne Capital Management, founded by Stan Druckenmiller, increased their holdings of the stock during the same period.

Given Micron Technology's current low price-to-earnings ratio, the buying behavior of the above-mentioned bigwigs shows that they are confident in the stock's prospects, while most investors are now skeptical about technology stocks, including this stock.

Micron Technology experienced a narrow range of fluctuations for nearly two months in the first quarter, and then surged, and Wall Street was optimistic. However, since late March and early this month, after the stock released disappointing financial reports, many investors questioned the stock's prospects, and the stock then fluctuated downward.

The entry of well-known hedge fund industry leaders into the market to buy at the bottom in the first quarter may mean that the market's stance on Micron Technology is expected to change.

Kevin Cassidy, an analyst at Stifel Nicolaus, an investment bank and brokerage firm, raised Micron Technology's price target to $101 on Tuesday, which is at the higher end of Wall Street expectations.

Considering that Micron Technology closed at $55.48 on Monday, this means Kevin Cassidy believes the stock could double in the future.

A Wall Street analyst said last week that if investors want to benefit from the long-term growth of the chip industry, then Micron Technology is a good way. RBC Capital Markets analyst Amit Daryanani said:

Micron Technology offers investors a unique way to gain exposure to the DRAM (dynamic random access memory) and NAND (computer flash memory) markets, and we believe the stock is also trading at an attractive valuation.

Amit Daryanani is not the only one who is bullish on Micron Technology.

According to the SEC's 13F position disclosure documents, hedge fund Coatue Management bought 14.5 million shares of Micron Technology in the first quarter. Appaloosa, led by David Tepper, and Duquesne Capital Management, founded by Stan Druckenmiller, increased their holdings of the stock during the same period.

Given Micron Technology's current low price-to-earnings ratio, the buying behavior of the above-mentioned bigwigs shows that they are confident in the stock's prospects, while most investors are now skeptical about technology stocks, including this stock.

Micron Technology experienced a narrow range of fluctuations for nearly two months in the first quarter, and then surged, and Wall Street was optimistic. However, since late March and early this month, after the stock released disappointing financial reports, many investors questioned the stock's prospects, and the stock then fluctuated downward.

The entry of well-known hedge fund industry leaders into the market to buy at the bottom in the first quarter may mean that the market's stance on Micron Technology is expected to change.

Kevin Cassidy, an analyst at Stifel Nicolaus, an investment bank and brokerage firm, raised Micron Technology's price target to $101 on Tuesday, which is at the higher end of Wall Street expectations.

Considering that Micron Technology closed at $55.48 on Monday, this means Kevin Cassidy believes the stock could double in the future.

After the US-China trade negotiations reached a consensus on "stopping the war" over the weekend, Micron Technology released another impressive financial report on Monday, announced the approval of a $10 billion stock repurchase plan, and reached a cooperation agreement with Intel. Boosted by this, Micron Technology's stock price rebounded sharply, with a cumulative increase of 35% this year.

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