Micron faces production-cut downside before bottoming
The guest argued that Micron is likely to experience a significant drawdown toward $3.25 due to helium supply issues and production cuts, presenting a buying opportunity at lower levels.
The argument
Despite trading at a cheap forward PE and being poised to beat earnings, the guest expects Micron to undergo a deep drawdown similar to Nvidia's historical volatility before finding a structural bottom.
The thesis, stress-tested
✓ What validates it
- ✓Helium supply disruptions force Micron to announce official production cuts
- ✓The stock price approaches the $3.25 level
▸ Risks discussed
- ▸Earnings beats could override the helium production overhang
- ▸Broad semiconductor sector strength could prevent the stock from reaching the $3.25 target
Hear it yourself
"It's trading at sub four PE off earnings next year, and they're very likely to beat earnings. But I think the helium problem could bring some production cuts. So I thought in my mind as we kind of when I started turning more bearish that I could see this thing go down to $3.25."
00:00 / 00:17
AFFILIATE LINK · ZORTIX MAY EARN A COMMISSION · NEVER A RECOMMENDATION TO TRADE