Micron Technology, Inc. provides semiconductor solutions worldwide. The company manufactures and markets dynamic random access memory (DRAM), NAND flash, and NOR flash memory products; and packaging solutions and semiconductor systems. The company was founded in 1978 and is based in Boise, Idaho.
MU Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for MU, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Micron Technology Inc ranked in the 4th percentile in terms of potential gain offered. We should note, though, that the most conservative analysis suggests this stock will yield negative results -- and thus may be a potential short opportunity. In terms of the factors that were most noteworthy in this DCF analysis for MU, they are:
The company's compound free cash flow growth rate over the past 5.73 years comes in at -0.27%; that's greater than only 6.26% of US stocks we're applying DCF forecasting to.
Micron Technology Inc's effective tax rate, as measured by taxes paid relative to net income, is at 0 -- greater than only 24.01% of US stocks with positive free cash flow.
The company's cost of debt, derived from its interest coverage, tax rate, and market capitalization, is greater than only 0% of stocks in its sector (Technology).
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
ALOT, APPF, DOCU, ELSE, and MELI can be thought of as valuation peers to MU, in the sense that they are in the Technology sector and have a similar price forecast based on DCF valuation.
Those of us who've been around long enough will have less than fond memories of Micron's (MU) vicious cycles. I do not think this has fundamentally changed but I think the future prospects for memory stocks are a lot more upbeat – yes, the cycles still exist, but the peaks...