NEW YORK (TheStreet) -- Micron Technology (MU) - Get Report stock is up by 4.43% to $18.99 in midday trading on Wednesday, as the company begins talks with chipmaker SanDisk (SNDK) about a possible acquisition, Bloomberg reports.
SanDisk is reportedly in talks with Western Digital (WDC) as well, but the discussions will not necessarily result in a deal with either Micron or Western Digital, sources told Bloomberg.
A merger deal between SanDisk and Micron could be complicated by a decade-long partnership Micron has with Intel (INTC), Deepon Nag, analyst at Macquarie Group, said in a note, according to Bloomberg.
So far, 2015 has been the biggest year on record for semiconductor mergers and acquisitions, as the industry looks for growth opportunities amid higher costs and declining numbers of consumers, Bloomberg adds.
Micron Technology, based in Boise, ID, is a global provider of semiconductor devices.
Separately, TheStreet Ratings team rates MICRON TECHNOLOGY INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
We rate MICRON TECHNOLOGY INC (MU) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and weak operating cash flow.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The gross profit margin for MICRON TECHNOLOGY INC is rather high; currently it is at 50.50%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 13.08% trails the industry average.
- MU, with its decline in revenue, slightly underperformed the industry average of 11.3%. Since the same quarter one year prior, revenues fell by 14.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income has significantly decreased by 59.0% when compared to the same quarter one year ago, falling from $1,150.00 million to $471.00 million.
- Net operating cash flow has decreased to $1,030.00 million or 23.53% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, MICRON TECHNOLOGY INC has marginally lower results.
- You can view the full analysis from the report here: MU