美光目前下跌23%，市盈率为未来盈利的5倍；下季度业绩超预期，且未来12个月新增供给有限，因此短期可能是一个动量买入机会，3至5年应该表现不错。但来自三星、SK海力士和中国竞争对手的供给上升会侵蚀存储寡头的利润率，因此时间越往后，乐观情绪越难维持。

Micron's stock has fallen by 23%, and many investors believe it represents great value trading at only five times future earnings. But, Lou, the big question for us today is: Is this a good time to buy, or have we already peaked with Micron?

Firstly, from a supply perspective, one of the things that affects Micron's stock in the short term is the increase in supply entering the market. Do you think a Chinese memory supplier is something worth considering if you're looking at Micron's stock?

I mean, yes, Micron's stock is low, but so what? The stock has risen by more than 500% over the past year based on this almost unlimited demand.

If another player is competing for a portion of that market, that changes the economics of the business, period. But when you get to the end of 2027 and even 2028 and 2029, suddenly Micron will add supply , SK Hynix will add supply, as will Samsung, and you have at least one or two suppliers from China who will bring more supply to the market.

So, we always hear about demand exceeding supply, but it seems that on the supply side, there is a lot more that will soon be available, which will radically change that equation.

But to some extent , Micron's core business is this less sophisticated memory , whether it's for iPods or all these other products that need memory.

And to what extent CXMT might take that, well, that means your long-term customer could switch to another provider.

So, increasingly, as a Micron shareholder, you not only benefit from AI gains , but you become dependent on them if some of those other businesses go elsewhere, which changes the long-term outlook for the stock , I think.

So, what you're saying here is that the gap left by Micron and other companies in random access memory (DRAM) will be filled by someone else.

So, we've now reached 87%, which means that for every dollar of Micron's sales, 87 cents of that represents gross profit. 81 cents of which represents operating profit.

Just two years ago , in the November quarter of 2023, gross profit was even negative. When you think about these margin levels in the long run, and you can include a range of companies in this such as Nvidia, do you think there will be a return to the average where we eventually return, perhaps not next year, but after 3, 4, 5 or 6 years, to a gross profit margin of 20, 30 or 40%?

That's how it looks. I mean , I don't want to be the person who says it's different this time , because I don't think it's going to be any different for the next few quarters. Things may be different now, but in the long run, I can't imagine they will be different.

This is a business activity that is traditionally based on basic commodities.

The positive argument at the moment is that much of that new offering will not enter service until 2028. The negative argument is that 2028 is just around the corner , and it is an inevitable reality.

Yes, it's hard for me to believe that numbers they couldn't consistently achieve in the past have become the new normal just because they reached them. This is probably the least likely scenario in my view.

What is the positive argument for Micron stock going forward ? Is it only about operational processes? There should be a share buyback component. I don't think they can start doing that until later this year because of some funding they've received from the U.S. government, but wow, if you're buying back shares at five times the earnings, that could be very convincing.

When you look at whether the stock will rise from around $922 per share as we record this to $1,500 or $2,000 per share, what should happen? They generated $54 billion in revenue in the last quarter.

That was a 380% increase, I believe, on a year-on-year basis.

Adjusted earnings per share skyrocket with these margins. The forecast indicates more to come. I think they are expecting 61 billion versus the approximately 57 billion that analysts predicted.

And yes, I believe there is a $35 billion share buyback program scheduled to begin in the near future. With profit margins like these, you can repurchase your shares. So, the positive argument now is: I hope this continues .

So, at least , as you know, for the next twelve months or so, not much new offering will be coming to market . Part of that offer will be available on the market. This may provide long- term growth for these companies, and by long-term I mean, you know, the next three to five years.

I think it's very difficult to know what will happen in five years or more, but this should be a very good period for Micron.

Okay, let's look at the downside . If the stock continues to decline, what do you think is the reason? the competition is increasing, and I think this week was just a reminder that the competition is already there , not a real surprise.

Whether it's Samsung, Hynix, Chinese companies, or any other entity, there will simply be more supply in the system over time.

We've already said that, memory is cyclical. It always has been . And I think it will remain so. Part of that is due to the possibility of increasing supply. While everyone is working to increase supply, capital expenditures are skyrocketing along with revenues.

Now, they can afford it . This is the right time to invest in your business.

Another thing, as an investor, is that you need to realize that fluctuations at the moment are normal. I looked it up quickly. Micron 45's stock has seen a movement of more than 5% this year. 45 movements in one day, representing more than 5%.

This is not a safe stock for conservative investors .

I think we really need to highlight the competitive aspect, because what was unique in 2026 was that this market was an oligopoly. This is somewhat similar to the telecommunications sector in the United States, is n't it?

There are three main suppliers. They can all understand each other implicitly, you know? Let's keep the offer at its current level. Let's keep these margins extremely high. Things are going very well for all of us.

The reason I think these Chinese suppliers are interesting in this area right now and pose a threat from the downside is that they are not part of this tacit understanding. Chinese manufacturers have a completely different incentive structure than many of the American and South Korean companies that built the industry we know today.

Therefore, they may be less concerned with short-term or long-term profits, and are willing to reduce those profit margins.

So, I think this is something really worth watching because we may look back in a few years and say, " Hey, Micron still has this business in the high-bandwidth memory (HBM) space.

Maybe it's not reaching the 87% margin we're achieving today, but it's still a great business with a 65% profit margin." But they completely abandoned the DRAM business because they allowed some of these other suppliers to enter the market.

I am inclined to be pessimistic about these companies because their upward trajectory has been very strong . The market is looking at what will happen over the next 18 to 24 months.

This market doesn't really care what happens in the next quarter. The numbers will be fantastic. Let's emphasize that once again. This is not a company that will deliver poor results in the next quarter or even early next year.

If you look at the long term, from 3 to 5 years, do you tend to be optimistic or pessimistic? I think the longer your outlook is , the harder it becomes to be optimistic. I have no doubt that momentum traders may benefit from the current situation.

But yes, the further ahead you look, the more I think my best advice to investors is to focus on the future , while keeping in mind the lessons of the past. In this case, I believe that the past indicates that the long-term trend is downward.

In the short term, I think this could be a momentum-driven buying opportunity this week.