The calculations below outline how an intrinsic value for
is arrived at by discounting future cash flows to their present value. We use
analyst's estimates of cash flows going forward 5 years.
See our documentation to learn about this calculation.
|Levered FCF (USD, Millions)||$7,406.52||$7,723.87||$6,372.00||$7,147.87||$8,018.22|
|Source||Analyst x10||Analyst x10||Analyst x3||Extrapolated @ (12.18%)||Extrapolated @ (12.18%)|
Discounted (@ 10.61%)
Present value of next 5 years cash flows:
Terminal Value = FCF2022 × (1 + g) ÷ (Discount Rate – g)
Terminal Value = $8,018 × (1 + 2.47%) ÷ (10.61% – 2.47%)
Terminal value based on the Perpetuity Method where growth (g) =
Present value of terminal value:
Equity Value (Total value) = Present value of next 5 years cash flows +
$88,293 = $27,336 + $60,958
Value = Total value / Shares Outstanding ($88,293 / 1,156)Discount to Share Price
Value per share:
Current discount (share price of $46.53): 39.06%
The discount rate, or required rate of return, is estimated by calculating the Cost of Equity.
Discount rate = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
Discount rate = 10.61% = 2.47% + (1.081 * 7.53%)
The Levered Beta is the Unlevered Beta adjusted for financial leverage. It is limited to 0.8 to 2.0 (practical range for a stable firm). Note the market value of equity is used not the book value ($51,166,937,511).
Levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
1.081 = 0.977 (1 + (1- 40%) (17.71%))
Levered Beta used in calculation = 1.081
Mr. Sanjay Mehrotra has been the Chief Executive Officer and President at Micron Technology, Inc. since May 8, 2017. Mr. Mehrotra has more than 29 years of experience in the non-volatile semiconductor memory industry including engineering and engineering management positions at Intel Corporation, Seeq Technology, Integrated Device Technology and Atmel Corporation. He co-founded SanDisk LLC in 1988 and served as its Chief Executive Officer from January 1, 2011 to May 12, 2016, President from June 2006 to May 12, 2016, Chief Operating Officer since 2001 and Executive Vice President. He served as Vice President of Engineering, Vice President of Product Development, Director of Memory Design and Product Engineering at SanDisk LLC. He served as the Chief Executive Officer and President of Cavium Networks Inc. He has been a Director of QLogic Corp since August 16, 2016, Western Digital Technologies, Inc. since May 12, 2016 and Cavium, Inc. (Cavium Networks, Inc.) since July 2009. He serves as a Board Member of Divio. He serves on the Engineering Advisory Board of the University of California, Berkeley. He served as a Director of Western Digital Corporation from May 12, 2016 to February 6, 2017. He served as a Director of SanDisk LLC from July 21, 2010 to May 12, 2016. He holds several patents and has published articles in the area of non-volatile memory design and flash memory systems. Mr. Mehrotra received a B.S. and an MS Degrees in Electrical Engineering and Computer Sciences from the University of California, Berkeley.
Average tenure and age of the Micron Technology management team in years:
Average tenure and age of the Micron Technology board of directors in years:
Great news for investors – Micron Technology is still trading at a fairly cheap price. … With profit expected to grow by a double-digit 16.79% over the next couple of years, the outlook is positive for Micron Technology. … With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price.Simply Wall St - – Full article
Micron Technology's promising vision for earnings in the future has analysts expecting material growth of 50.97% in the coming year, but it's critical to take a step back and consider this expectation. … View our latest analysis for Micron Technology Breaking Down MU's Profit Margin Attractive margins generally indicate a desirable ability to translate sales revenue in to earnings, and return for shareholders. … Margin Calculation for MU Profit Margin = Net Income ÷ Revenue ∴ Profit Margin = 7.59 Billion ÷ 23.16 Billion = 32.77% Micron Technology's margin has expanded in the past five years, as a result of a 28.65% average growth in net income outstripping 12.97% in average revenue growth, which suggests that the company has been able to convert a larger percentage of revenue into net income whilst grow their top line at the same time.Simply Wall St - – Full article
It compares a stock’s price per share to the stock’s earnings per share. … Formula Price-Earnings Ratio = Price per share ÷ Earnings per share P/E Calculation for MU Price per share = $41.67 Earnings per share = $6.82 ∴ Price-Earnings Ratio = $41.67 ÷ $6.82 = 6.1x The P/E ratio isn’t a metric you view in isolation and only becomes useful when you compare it against other similar companies. … Ultimately, our goal is to compare the stock’s P/E ratio to the average of companies that have similar attributes to MU, such as company lifetime and products sold.Simply Wall St - – Full article
Today I will be providing a simple run through of a valuation method used to estimate the attractiveness of Micron Technology Inc (NASDAQ:MU) as an investment opportunity by projecting its future cash flows and then discounting them to today's value. … 5-year cash flow forecast 2018 2019 2020 2021 2022 Levered FCF ($, Millions) $7,923.95 $7,432.95 $6,372.00 $7,147.87 $8,018.22 Source Analyst x8 Analyst x8 Analyst x3 Extrapolated @ (12.18%) Extrapolated @ (12.18%) Present Value Discounted @ 10.6% $7,164.61 $6,076.63 $4,710.07 $4,777.27 $4,845.42 Present Value of 5-year Cash Flow (PVCF)= $27,574 The second stage is also known as Terminal Value, this is the business's cash flow after the first stage. … Terminal Value (TV) = FCF2022 × (1 + g) ÷ (r – g) = $8,018 × (1 + 2.5%) ÷ (10.6% – 2.5%) = $101,079 Present Value of Terminal Value (PVTV) = TV / (1 + r)5 = $101,079 / ( 1 + 10.6%)5 = $61,082 The total value, or equity value, is then the sum of the present value of the cash flows, which in this case is $88,656.Simply Wall St - – Full article
MU's debt-to-equity ratio stands at 57.29%, which means, while the company’s debt could pose a problem for its earnings stability, it is not at an alarmingly high level yet. … NasdaqGS:MU Historical Debt Nov 23rd 17 A basic way to evaluate MU's debt management is to see whether the cash flow generated from the business is at a relatively high level compared to the debt capital invested. … Although MU’s debt level is towards the higher end of the spectrum, investors shouldn’t panic since its cash flow coverage seems adequate to meet obligations which means its debt is being efficiently utilised.Simply Wall St - – Full article
Since MU’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. … Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at MU future expectations. … It seems like the market has already priced in MU’s positive outlook, with shares trading around its fair value.Simply Wall St - – Full article
Micron Technology, Inc. provides semiconductor systems worldwide. The company operates through four segments: Compute and Networking Business Unit, Storage Business Unit, Mobile Business Unit, and Embedded Business Unit. It offers DDR3 and DDR4 DRAM products for computers, servers, networking devices, communications equipment, consumer electronics, automotive, and industrial applications; lower power DRAM products for smartphones, tablets, automotive, laptop computers, and other mobile consumer device applications; DDR2 DRAM and DDR DRAM, GDDR5 and GDDR5X DRAM, SDRAM, and RLDRAM products for networking devices, servers, consumer electronics, communications equipment, computer peripherals, and automotive and industrial applications, as well as for computer memory upgrades; and hybrid memory cube semiconductor memory devices. The company also provides NAND products, which are electrically re-writeable, non-volatile semiconductor memory, and storage devices; client solid-state drives (SSDs) for notebooks, desktops, workstations, and other consumer applications; enterprise SSDs for server and storage applications; cloud SSDs; and multi-chip package and managed NAND products. In addition, it manufactures products that are sold under other brand names; and resells flash memory products that are purchased from other NAND Flash suppliers. Further, the company provides 3D XPoint non-volatile memory products; and NOR Flash, which are electrically re-writeable and semiconductor memory devices for automotive, industrial, connected home, and consumer applications. It markets its products to original equipment manufacturers and retailers through its internal sales force, independent sales representatives, and distributors; and through a Web-based customer direct sales channel, and channel and distribution partners. The company was founded in 1978 and is headquartered in Boise, Idaho.
|Name:||Micron Technology, Inc.|
Micron Technology, Inc.
8000 South Federal Way,
|Exchange Symbol||Ticker Symbol||Security||Exchange||Country||Currency||Listed on|
|NasdaqGS||MU||Common Stock||Nasdaq Global Select||US||USD||01. Jun 1984|
|DB||MTE||Common Stock||Deutsche Boerse AG||DE||EUR||01. Jun 1984|
|XTRA||MTE||Common Stock||XETRA Trading Platform||DE||EUR||01. Jun 1984|
|LSE||0R2T||Common Stock||London Stock Exchange||GB||USD||01. Jun 1984|
|SWX||MU||Common Stock||SIX Swiss Exchange||CH||CHF||01. Jun 1984|
|BIT||MU||Common Stock||Borsa Italiana||IT||EUR||01. Jun 1984|
|WBAG||MU||Common Stock||Wiener Boerse AG||AT||EUR||01. Jun 1984|
|BMV||MU *||Common Stock||Bolsa Mexicana de Valores||MX||MXN||01. Jun 1984|
|Company Analysis updated:||2018/02/24|
|Last estimates confirmation:||2018/02/21|
|Last earnings update:||2017/11/30|
|Last annual earnings update:||2017/08/31|
All dates in UTC. All financial data provided by Standard & Poor’s Capital IQ.
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.