We are loading up Micron Technology (MU) here, after its epic Beat n Raise Q2 Earnings Report.
AI trends are really accelerating now. The 2nd and 3rd derivative plays needed to scale the next leg of AI - Inferencing (powering the explosion in use cases) - are now in play.
We view Micron as one of the THE TOP TIER 2nd-3rd derivative inflection points we will witness this year.
This is their NVDA moment.
Thus, the stock's move to All-Time Highs on what is, now set to be, one of the best days off accumulation the stock has ever had.
Demand for their new HBM3e AI product - which boasts 30% power-savings - has inflected and is J-curving. Longer-term, this will be the best memory cycles EVER, with prices set to boomerang in the coming quarters.
This excerpt from the note by our friend Hans Mosesmann at Rosenblatt is well worth the 2 minute read.
Hans laid out his case for this MOAC - Mother of All Cycles - on a napkin two years ago in a bar with me in NYC while out marketing with Clients. Sometimes you have to go with the hot hand. In this case, that is Hans.
While we are not looking for $200+, a re-rate to $150-$200 over next 3-4 quarters seems very likely (75% odds).
We therefore attach a 10-Conviction rating on this idea and plan to be patient.
STOP LOSS: We will use the 10-day EMA as our stop on MU.
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Disclosure: We are long MU stock and options. We may change our positioning at a moment’s notice, without notifying you of any such moves.
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