Tomahawk, WI 12/02/2013 (BasicsMedia) – The stock of Micron Technology, Inc. (NASDAQ:MU) has been on wild swing. The stock once hit $90 per share in 2000. The suddenly the stock tumbled to trade at $1.65. The stock was also affected in February 2012 following the death of the company’s CEO Steve Appleton.

The company currently has a market value of $22.19 billion and the stock trading around $21 per share. The stock is trading more than 200% up year to date.

Good tiding in memory market

Micron Technology, Inc. (NASDAQ:MU) is a leading semiconductor manufacturer in the category of primary memory. This market segment is witnessing good tidings as memory purchases increase their orders and the prices are also good. The imbalance of demand and supply in the market is also creating conducive business atmosphere for memory makers and MU is enjoying every moment of it.

The high demand for primary memory is precipitated by the shortage of supply following the fire which razed a manufacturing factor of  SK Hynix Inc (KRX:000660), a South Korean leading semiconductor manufacturer.

Also, there is a psychological issue at play as buyers of memory seek to boost the memory reserves on the rumors that a crippling shortage of chips was looming.

Elpida takeover

The takeover of Elpida by Micron Technology, Inc. (NASDAQ:MU) has had incredible positive impact on the company’s revenue and market share. It cost about $2.5 billion to acquire Elpida in a deal that was initiated in 2009. At that moment the chip market was cheap that it looked like a wild gamble going for a bankrupt company. But today fruits can be seen going into the future. In just one quarter, MU had its chip market share doubled to 26% and this happened almost without much effort. Before the purchase, MU had a market memory market share of $13%.

The fact that Elpida supplies major markets like Apple Inc. (NASDAQ:AAPL) also signifies that the best is till to come for Micron Technology, Inc. (NASDAQ:MU). This is particularly so considering that Apple Inc is projected to sell about 50 million iPhones through December which indicate significant revenue increase in the upcoming quarter.

The profit margins of MU also put it at an advantage to the competition

The surge of Micron Technology, Inc. (NASDAQ:MU) has been noticed by the big money and this also succeeds to validate the company’s long-term bright future. Hedge funds like Greenlight Capital Inc, do not go pursue short-term gains so this should tell the rest of the investor community particularly retail investors that there is benefit in holding the stock longer. Better still, those seeking a piece of this semiconductor entity can take position as long as the stock stays below $25 per share.

Greenlight Capital is reported to have acquired about 23 million shares of the stock at the total cost of $402 million. In this scenario, investors should be fixing the eyes on the stock for the next three years which, if the prevailing environment does not reverse drastically, is expected to be great for the stock.

The stretched supply for DRAM and the growing prices for the same are key factors which have a lot of bearing on the profitability of Micron Technology, Inc. (NASDAQ:MU). And with no let up in the market insight in the foreseeable future, the stock looks healthy now that it has Elpida which boasts strong connections which big memory buyers.

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