Shares of Micron Technology Inc. (MU) were up 4.67% on Tuesday to close the trading at $67.08.
The chip manufacturing company at start of the last week obtained two favorable recommendations on Monday, which caused the price to increase by 4.53 percent to $64.18 on the day. The stock afterwards gained 4.38% over the past week.
The Buy recommendation for MU shares was maintained by analysts at Deutsche Bank and Mizuho Securities in the midst of an anticipated recovery in demand for data centre equipment.
Deutsche Bank analyst Sidney Ho claimed that, following victory over COVID-19, Micron will be one of the winners of the rapid economic recovery. In key Micron markets such as data centers and 5 G smartphones, demand will recover. This will allow revenue and profitability to improve for the company. Against this backdrop, the target price was increased from $60 to $70 by Deutsche Bank while the previous price was set a month earlier when it upgraded the recommendation from Hold to Buy.
Mizuho analyst Vijay Rakesh expected a quicker recovery in demand for cloud computing than previously expected. In the first quarter of 2021, as tech giants like Facebook and Microsoft are likely to increase capital spending on data centers, Micron will get a big boost. Mizuho lifted its target price to $70 from $56.
Micron shares saw a decline in August and the following months. The fall in stock price at the end of September was attributable to the quarterly report and the optimistic projections for the development of financial indicators. But company’s performance in the past 3 months is still in green with a rise of 46.59%.
Because of a change in demand towards more high-tech and complex NAND memory processors, Micron noted a potential decrease in profitability. However as the launch of 5G technology continues, the amount of memory chip in smartphones increases, and data centers turn to more powerful memory chips, Micron Technology Inc. (MU) shares saw a strong rally in November as its gain over the past month is more than 33.25%.