Jim Cramer on Micron: “There Seems to Be No End to the Line of Sight Here for Demand”

Micron Technology, Inc. (NASDAQ:MU) was among the stocks on Jim Cramer’s Mad Money radar as he taught investors how to profit from the upcoming wave of takeovers. Cramer highlighted the company’s “blowout quarter,” as he stated:

We need to talk about the biggest story in this market: the memory chip shortage that’s propelled Micron into the trillion-dollar club, with its stock up more than 300% year to date. Now, in the old days, Micron was widely seen as a commodity chip maker. No more. There’s so much demand for high-end memory for the data center, and the company’s chips are much more proprietary, so proprietary that they’re practically printing money these days, and I think they deserve to.

Last week, Micron reported a blowout quarter, one of the biggest beats I’ve ever seen in my whole life, racking up $41.5 billion in revenues when Wall Street was only looking for $36 billion. That’s 74% growth just versus the previous quarter. They earned $25.11 per share, more than four bucks ahead of expectations. Gross margins, 85%, staggering for tech. And the current quarter’s on track to be even better because Micron keeps signing up what are called strategic customer agreements with businesses that are desperate to lock up supply of their chips.

There seems to be no end to the line of sight here for demand, but even after this incredible run, the stock sells for less than eight times earnings… Right now, Micron’s investing heavily in semiconductor manufacturing and R&D in the United States. They’re planning to spend $200 billion… across the United States, creating more than 90,000 jobs in the process. Although it’s going to take years before we see any output.

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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