Micron industry dynamics remain challenged, says Deutsche Bank

Deutsche Bank says Micron Technology’s fiscal Q2 results and Q3 guidance confirm the view that industry dynamics remain challenged for the company. Management pointed to incremental weakness in pricing together with continued inventory adjustments as the main drivers to $1.4B in inventory write-downs in the quarter, the analyst tells investors in a research note. The depth of the downcycle now looks deeper versus management’s prior expectations, and with a slower pace of recovery into the second half of 2023, says the firm. It believes the stock’s risk/reward at the current levels is balanced and keeps a Hold rating on the name with a $55 price target.