Samsung expects a record quarter, and Micron’s margin is the highest in its history, yet both stocks are well below their June highs. Micron’s last three slumps show what usually decides how this ends.
Mostly, but the catch is that the market's 'tomorrow' can be wrong. In 2018 and 2022, Micron's shares peaked within about a quarter of its gross-margin peak, so the forecast held. In June 2024, the shares peaked too, then fell 58% while the margin barely moved, and later rose nearly 19-fold. That's why we track the margin itself. Micron guides to about 86% for the quarter to early December, just below the 86.8% it just reported.
Memory stocks peak when investors price in tomorrow’s profits today.
Mostly, but the catch is that the market's 'tomorrow' can be wrong. In 2018 and 2022, Micron's shares peaked within about a quarter of its gross-margin peak, so the forecast held. In June 2024, the shares peaked too, then fell 58% while the margin barely moved, and later rose nearly 19-fold. That's why we track the margin itself. Micron guides to about 86% for the quarter to early December, just below the 86.8% it just reported.