On Monday, shares of Micron Technology (MU 8.34%) experienced another increase as the memory chip specialist continued to rally following a strong earnings report. Despite a decline in the broad market, several other AI stocks also moved higher, including Super Micro Computer and Arm Holdings. This was driven by a bullish endorsement from Barron’s over the weekend that deemed Micron one of the best and least appreciated long-term opportunities in the AI boom.
Micron has seen tremendous growth since its fiscal second-quarter earnings report last week, which were much better than expected. Revenue jumped 58% to $5.82 billion, and it reported an adjusted profit of $476 million, or $0.42 per share, well above a loss of $2.08 billion in the quarter a year ago. CEO Sanjay Mehrotra stated that he believes Micron is one of the biggest beneficiaries in the semiconductor industry due to the multi-year opportunity enabled by AI.
Looking ahead to the fiscal third quarter, management expects recovery to continue with revenue forecasted at $6.6 billion and gross margins predicted to improve by 24% to 27%. This is a positive sign for investors who are realizing that there will be multiple winners among chip stocks and not just Nvidia as previously thought.
Jeremy Bowman has no position in any of the stocks mentioned, but The Motley Fool recommends Nvidia and has a disclosure policy regarding potential conflicts of interest.
