What moat does Micron Technology have?

The advantage is knowing how to manufacture density at a cost that still fits inside the cycle price, inside an oligopoly of three. The scale of the fabs is the moat, and also the trap: they are not switched off. It is not a designer's software ecosystem and it is not ASML's lithography. The moat narrows if a fourth player manufactures the same density, or if the accelerator stops asking for so much bandwidth.

How do you read the Micron Technology radar?

Health depends on the point in the cycle and on the debt that finances the fabs. Quality looks excellent at the price peak and ordinary or negative at the trough. Growth is not a subscription. It is bits and price. Valuation looks cheap at the top, which is the trap, and expensive at the bottom on depressed earnings. Shareholder return flexes with the cycle. Do not read it as Coca-Cola's dividend.

Which multiples matter for Micron Technology?

Never take the P/E of a peak memory year as normal earnings. Through-cycle EV/EBITDA and net debt against results matter more. Gross margin at the top is not the margin of the trade. Compare Micron with the other two memory makers, not with Synopsys. A dash means the MU cache missed the figure.

What does this Micron Technology analysis leave out?

Not advice. Vaultflake does not forecast the DRAM price or the split of high-bandwidth memory. This report does not invent a share. One year's capex is not the cycle's capex. Read Micron's report. The table is a snapshot, not a target price.

Micron Technology (MU) analysis

Micron Technology, Inc.

Sector:Technology · Memory

Country:United States

Profile and moat

Micron manufactures memory: DRAM, NAND and the high-bandwidth memory that sits next to the accelerator. It is one of the three large producers, with Samsung and SK Hynix. It is not a logic foundry. It does not design the GPU. It sells the part that GPU needs if it is not to run out of data.

The memory price is a brutal cycle. At the top, the margin looks like an extraordinary business. At the bottom, the same fab loses money. Capital spending does not switch off at the bottom, because the next density has to be built first. Lam sells the etch for those layers. Micron is the customer, not the tool maker.

High-bandwidth memory ties part of revenue to the accelerator cycle. It does not turn Micron into NVIDIA. This report does not say Micron is the only producer of that memory and it does not state a share.

Micron Technology (MU) analysis

Micron Technology, Inc.

Sector:Technology · Memory

Country:United States

Micron Technology (MU) analysis

Profile and moat

Micron Technology (MU) analysis

Profile and moat

Radar axes

Limits of this report

Questions from this report

What moat does Micron Technology have?

How do you read the Micron Technology radar?

Which multiples matter for Micron Technology?

What does this Micron Technology analysis leave out?

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