• In August, it was Applied Materials. Then just last week (Sept 27), Micron Technology also delivered an optimistic outlook, signalling a likely upturn in the semiconductor cycle.

PCB gultech"We are well positioned to drive significant improvements in our financial performance," Micron said in its annoucement of its 4QFY23 (ended Aug 2023) results.

"We believe pricing has now bottomed. Ongoing demand growth, customer inventory normalization, and industrywide supply reductions have set the stage for increased revenue, along with improved pricing and profitability throughout fiscal 2024 (FY24)."

• The semiconductor industry has been hit by an oversupply of chips in the past year or so. Unless the economy gets bad, the inventory level will continue to come down as demand recovers. Semiconductors are used in a wide range of products, including computers, smartphones, and cars.

• Read DBS Research's takeaways from Micron's 4QFY23 results ...

Excerpts from DBS Research reoport

Positive takeaways from Micron’s sequential revenue growth amid steeper-than-expected losses

"Sequential improvement in Micron’s topline affirms our analysts’ view of an easing chip glut, with industry recovery to be led by the memory segment."
» 1Q24 revenue guidance at $4.4b (+10% q-o-q), above consensus estimate of $4.2b.

» Loss per share of $1.07 vs estimate of $0.95, partially attributable to company specific factors.

Sequential improvement in Micron’s topline affirms our analysts’ view of an easing chip glut, with industry recovery to be led by the memory segment. (Refer to our sector report to find out more).

Against this backdrop, we prefer companies with higher exposure to the memory segment.

» Stocks with exposure to the memory segment through global semiconductor customers include UMS via its key customer AMAT (Applied Materials) with c.35% exposure to memory and another new customer in the memory space.

» Broad-based industry recovery should also benefit technology stocks such as Venture and Grand Venture though we caveat that global headwinds remain and manufacturing recovery in Singapore is likely to be gradual and fragile.


 See also: 
 • Semiconductor recovery: Signs are there? Yup!
•  UMS: Well-positioned for semicon recovery -- but share price has risen 15%

You may also be interested in:

You have no rights to post comments

Counter NameLastChange
AEM Holdings2.3000.060
Avi-Tech Electronics0.265-
Best World1.7000.020
Broadway Ind0.0960.001
China Sunsine0.390-0.010
Delfi Limited0.930-0.035
Food Empire1.420-0.020
Fortress Minerals0.280-
Geo Energy Res0.3600.020
GSS Energy0.0270.001
Hong Leong Finance2.470-0.010
Hongkong Land (USD)3.150-0.090
ISDN Holdings0.3200.005
IX Biopharma0.041-0.004
Jiutian Chemical0.024-0.001
KSH Holdings0.250-
Leader Env0.050-
Medtecs Intl0.1310.001
Nordic Group0.335-0.005
Oxley Holdings0.090-0.001
REX International0.1460.012
Sinostar PEC0.135-0.003
Southern Alliance Mining0.600-
Straco Corp.0.500-
Sunpower Group0.220-
The Trendlines0.085-
Totm Technologies0.021-0.002
Uni-Asia Group0.815-
Wilmar Intl3.3600.030
Yangzijiang Shipbldg1.780-0.010

We have 919 guests and no members online

rss_2 NextInsight - Latest News