Micron Technology, Inc. (NASDAQ:MU) will issue the company's financial results for its fiscal 2014 second quarter on Thursday, April 3, 2014, after the market close. Management will hold a conference call at 4:30 p.m. eastern time. The call will focus on the company's results for the second quarter and year-to-date as well as future expectations.
Wall Street anticipates that the memory-chip maker will earn $0.76 per share for the quarter, which is $1.04 more than last year's loss of $0.28 per share. iStock expects MU to top Wall Street's consensus number. The iEstimate is $0.81, a bullish surprise of a nickel.
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Sales, like earnings, are expected to explode, rising 91.8% year-over-year. Micron's consensus revenue estimate for Q2 is $3.99 billion, up from last year's $2.08 billion. That's impressive with a capital IMPRESSIVE.
Micron is a global manufacturer and marketer of semiconductor devices, principally NAND Flash, DRAM and NOR Flash memory, as well as other memory technologies, packaging solutions and semiconductor systems for use in computing, consumer, networking, automotive, industrial, embedded and mobile products. In addition, the Company manufactures semiconductor components for CMOS images sensors and other semiconductor products. The Company operates in four segments: NAND Solutions Group (NSG), DRAM Solutions Group (DSG), Wireless Solutions Group (WSG) and Embedded Solutions Group (ESG).
[Related -Micron Technology, Inc. (NASDAQ:MU) Q1 Earnings Preview: High Inventory and Low Prices = Uh Oh?]
We aren't alone in expecting a bullish earnings surprise from MU. Jefferies analysts, Sundeep Bajikar and Mark Lipacis told interested investors, "We expect price stability in DRAM to continue to be a source of upside surprises. In NAND, we believe a combination of factors including SDN, is creating a large Cloud opportunity for Enterprise SSD, from which Micron is well positioned to benefit. We expect stable earnings to drive higher valuation."
Now, exceeding the consensus outlook has been a bit of a rarity of Micron. The tech company has produced just three quarters of better than expected EPS in the last 13 quarterly checkups. Two of the three saw the stock climb 11.11% and 15.48% (last quarter), as a result. Meanwhile, shares gave up -1.56 for the third.
If the first quarter is any indication, then MU's margins could expand. Revenue was up 120.39% year-over-year (YOY) in Q1, but cost of goods sold grew at a much slower 70.75%; selling, general and administrative at an ever slow pace of 47.9%; and research and development at 42.86%. If Q2's income statement looks like the first quarter's, fat margins are coming.
What absolutely remarkable is inventory was down 7.17% YOY, despite triple digit revenue growth. Normally, the relationship means the company; MU in this case, has strong pricing power, which should be another plus for the bottom line.
Overall: Pricing power, plus rising sales, plus costs shrinking as a parentage of sales equals a dominating quarter, which is what we expect from Micron Technology, Inc. (NASDAQ:MU). If history holds, shareholders could be in for an enjoyable Friday of gains from the semiconductor.
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