Micron Technology, Inc. (NASDAQ:MU) is still a good stock to buy right now if one asks CNBC’s Jim Cramer. In a recent discussion, he talked about how the DRAM industry is different this time and how this difference is affecting the semiconductors company.
The comments about Micron Technology, Inc. (NASDAQ:MU) comes after what Carl Quintanilla described as recent doubts about the company. Quintanilla noted that there is news that Samsung will raise DRAM pricing in July which, he said, is a good thing for companies in the space.
According to Cramer, he remembers the cycle in the DRAM industry in 1994 when companies in the space added new capacity and tipped the balance from equilibrium to overabundance of supply. However, right now, he said that nobody is adding new capacity. Thus, Micron Technology, Inc. (NASDAQ:MU) should be good. Furthermore, he noted that the company has managed to diversify into flash memory. Look at SanDisk Corporation (NASDAQ:SNDK), he added, and how well diversification has worked for it.
Cramer then went on to say that he remembers how people derided him when he was positive on Micron Technology, Inc. (NASDAQ:MU) when it was still in the single digits. These people said, he noted, that he is courting disaster. These people, he added, reminded him of 1994. What is different, Cramer continued, is that there used to be 12 companies in this space whereas there are only three players now.
These comments coming from the CNBC host echoes his recent explanation why the current run at Micron Technology is different.
Watch the discussion below and also read the linked article above for a more in-depth explanation from Cramer.
Hedge funds with a stake in Micron Technology, Inc. (NASDAQ:MU) includes Ken Griffin’s Citadel Investment Group which reported about 6.13 million shares in the company by the end of the first quarter of the year. Another investor is Eric Bannasch’s Cadian Capital which reported 6.09 million shares in the semiconductors company also by the end of March.