Micron Technology Inc (MU
) share prices fell early Sept. 19, after the financial services firm Citigroup downgraded its rating on the stock to hold from buy.
Analyst Glen Yeung said he was downgrading because the Boise, Idaho-based semiconductor company's prices have gotten more expensive over the past several months. Micron Technology's stock price slid 2.15% to $17.74 per share in early trading on the New York Stock Exchange on Sept 19. The company had traded at a 52-week low of $11.60 per share on Sept. 29, 2005.
Micron Technology manufactures and markets semiconductor components including Dynamic Random Access Memory (DRAM), which is used in personal computers, and NAND Flash memory, commonly used for digital cameras and MP3 players.
Yeung has a positive medium-term view on the outlook for DRAM, but notes that prices are heading into a seasonally weak period, inventories are building, and capital expansion costs remain high. He thinks near term headwinds in the cycle for DRAMs will hurt Micron Technology's performance. Meanwhile Yeung also thinks that prices for NAND are likely to drop in the first half of 2007.
Yeung estimates that the company will have fourth quarter earnings per share (EPS) of 14 cents, compared to the Street consensus estimate of 31 cents EPS for the quarter.