Quick Win by the Algorithm: MU capitalize on Acquisition

Quick Win by the Algorithm

On December 11, 2016, the I Know First algorithm had predicted a bullish forecast for Micron Technology Inc. (MU). MU had a signal of 215.47 and a predictability of 0.74. In accordance with the algorithm, the company reported gains of 22.83% experiencing a quick win by the algorithm.

 

Micron Technology, Inc. is an American global corporation, ranked among the Top 5 Semiconductor producing companies in the world. Their products include, dynamic random-access memory, flash memory and solid-state-drives. Its consumer products are marketed under the brands Crucial Technology and Lexar. Micron and Intel together created IM Flash Technologies, which produces NAND flash memory.

 

On December 6th, 2016, Micron Technology Inc. announced its acquisition of Dynamic Random Access Memory (DRAM) manufacturer Inotera Memories Inc. With MU already owning 33% of Inotera, the cost of acquisition for the remaining 67% was approximately $4 billion.

Optimism was brimming after the deal went through, with great financial and strategic benefits expected. “We expect immediate accretion to gross margins, earnings per share and free cash flow along with enhanced operational efficiency as we align Inotera with our global manufacturing operations,” said CEO Mark Durcan.

A string of acquisitions has caused supply in the market to change, no longer split among 10 suppliers. Coupled with market conditions changing, demand for phone and computer parts has increased, as well as robust demand for memory. Micron see new areas of expansion in automotive and storage in data centers which will help push sales and growth.

This bullish forecast on MU was sent to current I Know First subscribers on December 11, 2016. 

Before making any trading decisions, consult the latest forecast as the algorithm constantly updates predictions daily. While the algorithm can be used for intra-day trading the predictability tends to become stronger with forecasts over longer time-horizons such as the 1-month, 3-month and 1-year forecasts.