Veteran memory chip specialist Micron Technology (NASDAQ: MU) was one of the tech sector’s clear winners on Wednesday. That’s somewhat unexpected, given that much of the company’s memory chip production is located in Taiwan, which was hit with a powerful earthquake the day before. But Micron’s swift reassurance of the situation, plus its tagging as a top pick by an analyst, earned it more than a 4% share price gain across Wednesday’s session.
Shaken but not broken
The earthquake was a strong one, measuring 7.4 in magnitude. Yet its epicenter in a relatively sparsely populated area, plus the many safeguards and preparations in place, kept the destruction and death toll relatively low.
Regardless, Micron was quick to publish an update reassuring its business partners and investors that all of its employees were accounted for and safe. While the chipmaker said it was “evaluating impact to our operations and supply chain,” the fact that its people were OK suggests its facilities were not extensively damaged.
Meanwhile, that morning Mizuho analyst Jordan Klein tagged Micron as being one of his top picks in the chip segment. He’s generally bullish on the sector, writing that “semi investors tend to like and favor signs of a trough or bottom, and that is signaled to be 2024.”
In addition to Micron, Klein’s top chip picks are Western Digital and Silicon Motion Technology.
A premature reaction
While the initial reports out of Taiwan, and Micron’s statement, indicate that the company wasn’t badly affected by the natural disaster, we don’t yet know the real impact. So that bullish investor reaction feels a bit premature; perhaps it’s best to wait for more concrete news of the situation before deciding to plunge into, or hold, the stock.
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Eric Volkman has positions in Western Digital. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Why Micron Technologies Zoomed 4% Higher Today was originally published by The Motley Fool
Jessica Roberts is a seasoned business writer who deciphers the intricacies of the corporate world. With a focus on finance and entrepreneurship, she provides readers with valuable insights into market trends, startup innovations, and economic developments.
