Micron Technology, Inc. (NASDAQ:MU) was among the stocks Jim Cramer discussed in this changing market. Cramer discussed whether the stock can still be bought here, as he stated:
You want a stunning fact? It took 490 days for NVIDIA stock to go from $500 billion market cap to a trillion. It took 48 days for Micron to make that exact same journey. That’s bonkers… But when you take the story apart, the action of Micron actually makes sense… How do you explain the action? First, you have to understand what Micron really trades on: three factors. One is demand. Here it’s insatiable because Micron makes high-bandwidth memory, exactly the kind of hardware that the data center desperately needs. Two, there’s a huge shortage of high-bandwidth memory chips…
Three, because almost nobody saw this shortage coming, there aren’t enough machines that can manufacture more chips… Still, Micron at a trillion dollars is hard to get your head around because historically, this has been a savagely boom-and-bust industry. The peak for this kind of stock typically comes when new production capacity gets added, bringing the memory chip market back into equilibrium. It hasn’t happened yet because it’ll take a long time to manufacture enough machinery. So we never got the peak… We don’t know when it’s going to come… Can you still buy it here? It depends. If there’s no new machinery coming online to make memory, then yeah, and I don’t see any.
Micron can keep flying, but my discipline tells me I just can’t do it. At this point in the rally, even I have to say I missed it. Sooner or later, I know that new capacity is going to come on. I don’t want to walk headfirst into the buzzsaw, even if it means I miss some upside ahead of time. But others don’t share my discipline; they’ve been right. As I told the investing club, though, I simply don’t think Micron is worth the risk up here… If Micron pulls back hard, it’s another story.
Stock market data. Photo by Burak The Weekender on Pexels
Micron Technology, Inc. (NASDAQ:MU) develops memory and storage solutions, including DRAM, NAND, and SSD products, under the Micron and Crucial brands.
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