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If You Invested $1000 in Micron a Decade Ago, This is How Much It'd Be Worth Now

How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.

Another thing that can drive investing is the fear of missing out, or FOMO. This particularly applies to tech giants and popular consumer-facing stocks.

What if you'd invested in Micron (MU) ten years ago? It may not have been easy to hold on to MU for all that time, but if you did, how much would your investment be worth today?

Micron's Business In-Depth

With that in mind, let's take a look at Micron's main business drivers.

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Idaho-based Micron Technology has established itself as one of the leading worldwide providers of semiconductor memory solutions.

Through global brands, namely Micron, Crucial and Ballistix, Micron manufactures and markets high-performance memory and storage technologies including Dynamic Random Access Memory (DRAM), NAND flash memory, NOR Flash, 3D XPoint memory and other technologies. Its solutions are used in leading-edge computing, consumer, networking and mobile products.

A major portion of the revenues is derived from DRAM sales. The company's mission is to be the most efficient and innovative global provider of semiconductor memory solutions.

Micron reported revenues of $15.54 billion in fiscal 2023. The company has four reportable segments:

Compute and Networking Business Unit (CNBU): The unit comprises of DRAM and NOR Flash products that are sold to the computer, networking, graphics, and cloud server markets, and NAND Flash products which are sold into the networking market. CNBU delivered revenues of $5.71 billion (37% of total revenues) in fiscal 2023.

Mobile Business Unit (MBU): The unit comprises Micron’s discrete DRAM, discrete NAND and managed NAND (including eMMC and universal flash storage (UFS) solutions) products that are sold to smartphone and other mobile-device markets. MBU generated revenues of $3.63 billion (23%) in fiscal 2023.

Storage Business Unit (SBU): The unit accounts for solid state drives (SSDs) and component-level solutions sold into enterprise and cloud, client and consumer storage markets as well as other discrete storage products sold in component and wafer forms to the removable storage markets. SBU’s revenues grossed $2.55 billion (16%) in fiscal 2023.

Embedded Business Unit (EBU): The unit includes Micron’s discrete DRAM, discrete NAND, managed NAND and NOR products, which are sold to the automotive, industrial and consumer markets. EBU’s revenues logged $3.64 billion (24%) in fiscal 2023.

The company struggles with intense competition from Intel, Samsung Electronics, SK Hynix, Toshiba Memory and Western Digital Corporation.

Bottom Line

Putting together a successful investment portfolio takes a combination of research, patience, and a little bit of risk. For Micron, if you bought shares a decade ago, you're likely feeling really good about your investment today.

According to our calculations, a $1000 investment made in May 2014 would be worth $4,620.20, or a 362.02% gain, as of May 24, 2024. Investors should keep in mind that this return excludes dividends but includes price appreciation.

Compare this to the S&P 500's rally of 177.18% and gold's return of 73.03% over the same time frame.

Analysts are forecasting more upside for MU too.

Micron is benefiting from improved market conditions, robust sales executions and strong growth across multiple business units. The positive impact of inventory improvement in the data center, as well as stabilization in other markets, such as automotive, industrial and others, are contributing to top-line growth. It anticipates the pricing of DRAM and NAND chips to increase next year, thereby improving its revenues. The pricing benefits will primarily be driven by rising AI servers, causing a scarcity in the availability of cutting-edge DRAM and NAND supply. Also, 5G adoption in the Internet of Things devices and wireless infrastructure is likely to spur demand for memory and storage. The stock has outperformed the industry year to date. However, the United States and China’s tit-for-tat trade war is a major threat to the company.

The stock is up 13.16% over the past four weeks, and no earnings estimate has gone lower in the past two months, compared to 3 higher, for fiscal 2024. The consensus estimate has moved up as well.

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