Micron bucks Wall Street, soars to 18-year high

There’s been a ton of good news, and a US$10bn share buyback fueling the chip maker’s high-octane ascent
A computer memory chip in a person's hand
Micron shares jumped to an 18-year high on Tuesday

Despite sharp declines on Wall Street and a nearly 1% drop in the tech-laden Nasdaq, one lone tech stock made big waves: Micron Technology Inc (NASDAQ:MU).

Shares jumped 3.6% to an 18-year high, bucking the slight weakness seen in the semiconductor sector and a broad-market selloff on Wall Street on Eurozone fears.

Micron stock was trading at US$63.98, their highest level during the regular session since Sept. 21, 2000, according to reports.

The US memory chip maker’s shares have soared 19.1% since the company's investor day on May 21. The rally has been fueled by strong revenue and earnings growth, with earnings expected to climb to US$11.56 per share in 2018, from just US$0.06 per share in 2016.

READ: Micron Technology shares soar after unveiling Intel deal and a US$10bn stock buyback

More than half the analysts covering Micron hiked their target price on the stock after the company announced a $10bn buyback as part of a broader capital returns program.

The buyback news “is a big vote of confidence in the strength of the business model,” said MKM Partners analyst Ruben Roy, who has a buy rating and raised his stock price target to US$72.

The second part of the positive story is about Micron’s collaboration with Intel Corp (NASDAQ:INTC) to make and ship new high-density chips which will be put into flash drives. The collaboration will revolve around the first 4bits/cell3D NAND flash memory chips.

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