Micron Technology, Inc. (NASDAQ:MU) was among Jim Cramer’s stock calls on Mad Money recently. Cramer highlighted the company’s stock price action during the year, as he stated:
What we’re measuring is what was up the most since the close on March 30th. That was the day that the broader market bottomed until the close last Friday. And when we look at the top 10 performers in the S&P 500 over that period, what we find is not just tech, but more specifically, a whole lot of data center play tech. Why don’t we start with memory and data storage… Sandisk, Seagate, Western Digital, and Micron, those were the second, fourth, sixth, and 10th best performers in the S&P since the bottom. After soaring last year and soaring again in January, these stocks didn’t even really pull back in February and March. They mostly just traded sideways.
As of Friday’s close, Sandisk was up 61% before the bottom, Seagate up 51%, Western Digital up 48%, and Micron up 41%. It’s getting to the point where I don’t even know what to say about these storage company stocks… The move started out legit, okay, unfolding as investors realized that the hardware for AI requires lots more memory than anyone thought, except for Jensen Huang, and there simply wasn’t enough to go around. It could take years to build enough production capacity to solve this shortage. So I recognize why people keep buying these stocks.
That said, I’m a little wary of what happened when Micron reported last month. They delivered a really strong quarter. It was, nevertheless, a negative catalyst for the stock because it came in too hot. Micron’s mostly recovered since then, but it still hasn’t taken out its mid-March high. As always with the memory plays, you got to keep one eye on the exit because this is and can be a boom-bust industry. You don’t want to be left holding the bag. But for now, this group is very much still working because there just isn’t a lot of supply coming on, and the demand is the strongest I’ve ever seen. And when I say coming on, I mean over the next 18 months, I don’t see any supply coming on of any substance.
Photo by Yiorgos Ntrahas on Unsplash
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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