Your take on what is an absolute punishment on the stock today? Absolutely.
Well, I've been doing this for a number of years, since 1999.
And well, I was a sell-side analyst and a buy-side analyst, then a PM, then
chief investment officer of my own firm.

That being said, this is not my first day at this rodeo, and Micron in particular, and all the memory companies seem to have this boom-bust cycle, and the boom and bust can be really close to each other, as evidenced

by the price chart of Micron.
So what's an investor to do? Well, some people would like to be able to trade this, know when to go in low, know when the high is.
Good luck with that.

I think what you have to do is look at Micron and say it has terrific growth.
There are very few players in this space.
There's maybe six or seven companies that are competitors.
And for the most part, sometimes bad things like this happen, but sometimes good things happen too.

And to be able to trade around that, around these events where there's a sudden shortfall in demand, but it will be made up, I think it's more of a buying opportunity than getting out.
Now, the other thing is, if you look at

that chart, some people bought it at much higher prices this year, and it could be tax-loss selling going on.
That's really driving the price down today.
So there's a seasonality element. All of this is interesting if you go to analyst recommendations at the moment.

Now, a lot of people cut their price targets, but still, you've got 37 buys on this stock. You've only got one sell. And the overall consensus price target is still at 135. You've got room to run up from the $85. But how does Sanjay Mehrotra get us

there in terms of what he needs to signal now to the market? How much can he say, 'Look, put aside China, put aside my exposure to the consumer. I'm all in on AI.' Well, I think he made the case that he's all in on AI, right?

Like they have the products that AI wants and needs. AI, for many reasons, has saved this market, right? I mean, Nvidia and Micron have certainly driven it. But the real issue here is the AI

People are buying stuff and building out their data centers, and I don't know that that's going to stop in any definable time. And I—did you—sorry, just a button there, Kim, did you get that sort of easing of

any anxiety, whether or not it was closely held or far away, that we might be at some pivot point where the demand does start to ease up? Sure. I mean, well, here's what investors really have to understand. Micron is

a very small world in which all of its clients are either all on or all off, or so it seems. And if you remember, when we were building out regular cloud databases or cloud data centers, it's lumpy. And what I mean by that is you're either building out or you're not, and all of a

Suddenly, it can stop. And whenever several companies that had been building out data centers start, you know, the providers get clobbered. That's just the nature of this. And we don't know when it's going to stop. So investors have to be aware that we're

not going to be spending in perpetuity to build out AI. There will be a day when people take a pause and actually have to, you know, reap the rewards of building this product and, you know, having people pay

for the service. These mega clusters, at the moment, though, that we seem to be seeing is not a signal of us pulling back any time soon. But does macro policy, does a new administration in any way dampen the spirits or only accelerate them? Can it?

It doesn't seem so, because the companies that are building these data centers out have enough money from what they're doing now. They don't need to be able to say, in the future, "I'll be able to, you know, in

some very definable timeline, I need to get my money back." So they're going to be building these things out because they have the cash flow. And I'm talking about Microsoft, Google, and Meta. Their regular businesses are providing

the capital to build out data centers. So you said this potentially could be a buying moment for Micron. What about the chip space more broadly, because everyone's been suddenly in on this focus on software trade, right? Well, I think it's great. Like, at some point, software has to come

back to winning.
I used to be a software engineer, and I would love to be able to buy a good software company that I think will grow in perpetuity.
I like money-making machines. Microsoft has been that, although it had a lull in the 2010 to 2014 range,

something like that.
But yeah, software is great, but hardware is what's driving me crazy right now because it seems there's no lack of demand, and I think the software will follow. Now, a lot of people are momentum investors, and I worry about NVIDIA because

Broadcom is kind of taking a little air out of the room for Nvidia.

Micron Plummets on Weak Outlook

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Bloomberg Technology

Analyst's Perspective on Micron's Stock Performance and the Boom-Bust Cycle

Analyst's extensive experience in financial markets since 1999.

Micron and memory companies' characteristic boom-bust cycles.

Difficulty in precisely timing market entries and exits.

Micron's strong growth potential and limited competition.

Current market downturn potentially a buying opportunity due to factors like tax-loss selling.

Micron's Focus on AI and Market Sentiment

Positive analyst recommendations despite price target cuts (37 buys, 1 sell).

Micron's strong position in the AI market.

AI's significant impact on the market, driving demand for Micron's products.

Ongoing demand for data center build-outs, fueled by AI.

Market Volatility and Investment Strategy

Micron's dependence on clients' on/off investment cycles.

Lumpy nature of data center build-outs leading to market volatility.

Uncertainty about the duration of sustained investment in AI infrastructure.

Current strong demand despite potential future pauses in investment.

Impact of Macroeconomic Factors and Future Outlook

Strong financial position of major tech companies driving continued investment.

Companies' sufficient cash flow to sustain data center build-outs.

Microsoft, Google, and Meta's existing businesses funding data center expansion.

Comparison of Software and Hardware Investment

Analyst's preference for hardware investments due to high demand.

Analyst's belief that software growth will follow hardware growth.

Concerns about NVIDIA's momentum due to Broadcom's impact.

Micron Plummets on Weak Outlook

Micron Plummets on Weak Outlook

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