Micron Technology, Inc. (MU), AT&T Inc. (T): This Resurgent Stock Is Screaming for Attention, Are You Listening?

Going forward, this business should gain further traction, as carriers like AT&T Inc. (NYSE:T) upgrade their networks. Late last year, AT&T Inc. (NYSE:T) decided to step on the gas for rolling out its next generation networks. The carrier would spend $14 billion for enhancing its wireless and wireline broadband networks, while total capex would be $22 billion a year for the next three years. Micron expects such optimism to drive its DRAM networking revenue up one notch, while the build out of data centers would be another tailwind.

Strong pricing and demand

Micron has witnessed strength in DRAM prices this year, and there are indications that this strength will continue. Tight channel inventory and demand-supply balance are the reasons why management is confident of further upswing in DRAM prices. Moreover, Micron Technology, Inc. (NASDAQ:MU) is highly focused on increasing its market share in the mobile DRAM segment, and now counts “two of the top five smartphone makers” as clients according to President Mark Adams.

Micron is anticipating solid growth in the mobile DRAM market, and the acquisition of Elpida might lead to even better days. As Fool analyst Anders Bylund had mentioned last year, Elpida had landed the contract for supplying iPhone and iPad memory to Apple Inc. (NASDAQ:AAPL). Moreover, Apple had used other suppliers apart from Samsung for DRAM in the latest iPhone. As the Cupertino-based behemoth looks to reduce its reliance upon Samsung, it won’t come as a surprise if Micron gets a deal from Apple in the future.

Apart from DRAM, Micron’s NAND business is also doing pretty well now. Explosive growth of mobile devices has led to great demand for NAND flash. Micron expects 40% growth in smartphone shipments this year, which is the reason behind management’s optimism regarding better demand and stable pricing.

The bottom line

After struggling last year, things appear to be falling in place for Micron Technology, Inc. (NASDAQ:MU). The company expects its end markets to push demand for its products higher, while better demand-supply balance should support DRAM and NAND prices. Keeping these factors in mind, I expect Micron to get even better as the year progresses.

The article This Resurgent Stock Is Screaming for Attention, Are You Listening? originally appeared on Fool.com and is written by Harsh Chauhan.

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