After performing an analysis for Micron Technology’s fiscal 2019 and 2020, Piper Jaffray analyst Harsh Kumar says average selling price erosion and market oversupply, specifically in DRAM, are likely to persist into the second half of the year. The length of CPU shortages still remains uncertain through the first half, Kumar tells investors in a research note. The analyst also sees mobile weakness and data center softness as additional near-term headwinds for Micron “at this time.” As a result, he lowered his fiscal 2019 earnings per share estimate for the company to $7.20 from $8.30 and revenue estimate to $24.4B from $26.1B. Kumar’s new estimates reflect his “base case,” but he cautions “industry trends suggest that things could get worse from here and approach our bear case.” The analyst reiterates a Neutral rating on Micron with a $36 price target. The chipmaker closed yesterday down 10c to $37.83.
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