Micron Technology, Inc. (MU): This Is About To Spike

Even if there’s a minor disruption in Samsung’s production, it’s a good possibility that global prices of NAND and DRAM modules could increase significantly. Since Micron Technology, Inc. (NASDAQ:MU) is isolated from the troubled region, it would naturally stand to benefit from the rising prices, and would have the opportunity to gain a greater market share.

Even Toshiba stands to benefit here. The company has been producing memory modules with a 19nm fabrication process for over a year now, while Samsung and Micron still use the 20nm process. Although it currently has a slight competitive advantage, the market for enterprise solutions still requires 20nm fabricated chips, which is largely dominated by Micron Technology, Inc. (NASDAQ:MU). But, that doesn’t imply that Toshiba won’t benefit from a plunge in North Korean output.

Wrap up

I believe that Toshiba is a fine company, and is in a turnaround with competitive consumer products at highly competitive prices. But, the world’s second largest chipmaker is struggling with depreciating Yen, which has inflated the domestic prices of consumer electronics and reduced the market demand. This is one of the main reasons behind Toshiba’s massive revenue drop of 7.80% in the recent quarter. The company generates around 45% of its revenue (memory segment) from Japan, and the depreciating Yen would continue to hurt Toshiba’s top line.

Naturally, the war-like situation in North and South Korea would lead to currency depreciation. But, since Samsung generates the bulk of its revenue from international shipments, I believe the forex gains on its consumer electronics shipments could offset a part of the potential revenue drop in its memory division.

With that said, I think Micron Technology, Inc. (NASDAQ:MU) is a great company and deserves a buy rating, due to all the mentioned reasons.

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