Banned but Unbroken: Micron's China Conundrum Creates Buying Opportunity, Says Analyst
Portfolio Pulse from Anusuya Lahiri
Mizuho analyst Vijay Rakesh reiterates a Buy rating on Micron Technology (NASDAQ:MU) with a price target of $72.00, despite China's Cybersecurity Administration banning Chinese operators of crucial infrastructure from purchasing from the company. The analyst sees this as a buying opportunity and believes the restrictions could impact China's technology and AI expansion plans.
May 23, 2023 | 6:14 pm
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Mizuho analyst reiterates Buy rating on Micron Technology (NASDAQ:MU) with a $72.00 price target, despite China's ban on the company. The restrictions could impact China's technology and AI expansion plans.
The analyst believes that the ban could be a double-edged sword for China, as it may limit the availability of leading-edge DDR5 technology, which is crucial for advancing its next-gen technology roadmap. This could create a buying opportunity for Micron Technology, as the company dominates the leading-edge DRAM (DDR5) and NAND markets. Additionally, the analyst sees demand opportunities with the ramp-up of new Server/Data Center platforms in 2H23.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100
POSITIVE IMPACT
The CAC ban on Micron Technology (NASDAQ:MU) could be a short-term tailwind for Samsung Electronics (OTC:SSNLF) and SK Hynix, though broader channel inventories remain high.
The ban on Micron Technology could lead to increased demand for Samsung Electronics and SK Hynix products in the short term, as Chinese operators of crucial infrastructure look for alternative suppliers. However, the broader channel inventories remain high, which could limit the potential upside for Samsung Electronics.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 50