Micron Technology Inc. (MU) reported its Q4 earnings and wow. The company beat on both the top- and bottom-line estimates. Then right on cue, we got the obligatory head fake I cautioned about ahead of earnings. Here’s what traders should do next, writes Keith Fitz-Gerald, editor of 5 With Fitz.
It was a blockbuster report in every sense of the term:
- Revenue came in at $54.2 billion, up 379% year-over-year and ahead of the $51 billion consensus.
- Net profit came in at $37.7 billion, up roughly 1,078% YOY from $3.2 billion.
- DRAM revenue came in at $39.8 billion, up 343% YOY and 73% of total sales.
- Q1 revenue guidance is about $61.5 billion, well ahead of the $57 billion consensus.
- And drum roll… data center revenue up 11X!
Now what? You know the answer to that. I hope you didn’t fall for the aftermarket session head fake. And if you did, that you reconsider the proposition.
Micron stock has returned approximately 15.8X over the past three years, and my point of view is that it’s just getting started. The SPDR S&P 500 ETF (SPY), by comparison, has returned about 1.85X.
“Buy the best, ignore the rest” has never looked better!
