Computer memory specialist Micron Technology (NASDAQ:MU) has been downgraded by Wedbush Securities, on over-supply concerns.
According to investment analyst Betsy Van Hees, industry checks suggest cost cuts won't outpace declines in average selling prices until mid-2016.
While there may be benefits from PC upgrades and a seasonal uplift in mobile handsets, this may be more muted than previously expected, Vam Hees postulated.
"While we believe [Micron] is laying the right ground work with capex spend for long-term success, until we see signs that DRAM [dynamic random access memory] industry supply/demand environment is stabilizing, shares will likely continue to struggle," Van Hees predicted, as she slashed her price target to US$19 from US$26, though this is still just over US$2 above the current share price for Micron.
Micron shares were little changed at US$16.93 in lunchtime trading.