What's Going On With Micron Technology Stock Tuesday?

Micron Technology Inc. (NASDAQ:MU) stock edged lower Tuesday in premarket trading after falling 5.25% Monday. The previous session’s decline came amid a broader technology sell-off fueled by concerns over artificial intelligence spending.

The pressure continued Tuesday as U.S. stock futures weakened. Nasdaq futures fell 0.68%, while S&P 500 futures declined 0.58%.

The stock is also consolidating after a sharp 12-month rally. As a result, Micron could remain sensitive to swings in technology and semiconductor stocks.

Memory Boom Could Have More Room To Run

Despite the recent pressure on semiconductor stocks, Pella Funds CIO Jordan Cvetanovski told CNBC Tuesday that memory companies could continue performing well over the next one to two years.

Cvetanovski expects memory stocks to have a "very good time for the next year, possibly two." He pointed to unusually high margins and industry returns as key supports.

That outlook is particularly relevant for Micron, whose business is heavily exposed to memory demand and pricing.

However, Cvetanovski warned that strong profitability could eventually attract more investment and production capacity. That additional supply could pressure memory prices and margins.

He also highlighted heavy investor concentration in AI, semiconductors and related hardware. A slowdown in data-center demand or a change in the AI investment narrative could therefore trigger a sharp reversal.

AI Pullback Could Favor Software

Cvetanovski said a downturn in AI hardware could drive investors toward software companies such as Microsoft Corp. (NASDAQ:MSFT), Intuit Inc. (NASDAQ:INTU) and SAP SE (NYSE:SAP).

He still sees a need for AI data centers. However, he questioned the scale of the current buildout, asking "how many, and how much is enough."

Pella has therefore moved away from what Cvetanovski called the "eye of the storm" in chips and memory. Instead, the fund has maintained exposure to grid infrastructure and other businesses tied to the AI buildout.

Technical Analysis

Micron is trading 3.8% below its 20-day simple moving average of $960.43 and 0.4% below its 50-day SMA of $927.58. That puts the stock near intermediate-term support.

However, Micron remains 3.8% above its 100-day SMA of $889.83 and 47.6% above its 200-day SMA of $625.57. Therefore, the longer-term trend remains bullish.

The relative strength index stands at 46.15. That signals neutral momentum and suggests the stock is neither overbought nor oversold.

The moving-average structure also remains constructive. The 20-day SMA is above the 50-day SMA, while the 50-day SMA remains above the 200-day SMA.

Key resistance sits near $1,012. Meanwhile, support around $887.50 closely tracks the 100-day SMA and could serve as an important trend test.

Earnings And Analyst Outlook

Micron is scheduled to report earnings Sept. 30.

Wall Street expects earnings of $31.30 per share on revenue of $50.78 billion. That compares with earnings of $3.03 per share and revenue of $11.31 billion a year earlier.

Micron carries a Buy consensus rating with an average price forecast of $1,521.74.

Mizuho maintained an Outperform rating on Aug. 25 but lowered its price forecast to $1,300. New Street Research upgraded Micron to Buy on Aug. 14 with a $1,250 forecast. Citigroup maintained a Buy rating on Aug. 7 while lowering its forecast to $1,150.

Benzinga Edge Rankings

Micron scores strongly on several Benzinga Edge measures. Its Momentum score stands at 99.48, while Quality is 96.39 and Growth is 93.72.

However, its Value score is lower at 31.59. Overall, the rankings point to a stock driven primarily by momentum, growth and quality rather than valuation.

Top ETF Exposure

Micron has significant exposure through several exchange-traded funds. It accounts for 9.81% of the Invesco S&P 500 Momentum ETF (NYSE:SPMO), 8.14% of the State Street SPDR NYSE Technology ETF (NYSE:XNTK) and 9.67% of the SMART Earnings Growth 30 ETF (NYSE:SGRT).

Large inflows or outflows from these funds can therefore add to buying or selling pressure in Micron shares.

Price Action

MU Stock Price Activity: Micron Technology shares were down 0.10% at $923.11 during premarket trading on Tuesday, according to Benzinga Pro data.

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