Micron Braced For Losses (MU)

Micron Technology Inc. (NYSE:MU) is set to report earnings after the close today.  First Call has consensus at -$0.22 EPS and $1.4 Billion in revenues.  Next quarter is expected to show a loss of -$0.04 EPS on roughly $1.6 Billion in revenues.

Micron Tech. has been a real technology laggard in a market where so many stocks have performed quite well, particularly if you review the list of last week’s Window Dressing stocks that are up so much.  Shares are at $11.40, barely above the lows of the $10.30 to $18.18 range seen over the last 52-weeks.

Most of the actual recent analyst calls have become more positive and the average buy target appears to be close to $16.00.  Its chart has not been overly revealing and the recent $1.00 gain over the last couple weeks has removed any major oversold read.  Options traders seem to actually be braced for a move of up to $0.74 to $0.88 in either direction, which is insulation for a 6% stock move.  These options might be worth looking at because there are over 55,000 contracts in the open interest in the closest OCT Call Strikes ($11 and $12) and over 39,000 contracts in the open interest of the closest Put contracts.

The company has already cut 5% of its workforce, or has announced the cuts, and has said it is still expanding its IM Flash venture with Intel.  The company also noted lower DRAM prices affecting the quarter and higher production, but the US-DRAM leader did not offer up formal guidance.

Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.