In-Depth Analysis: Micron Technology Versus Competitors In Semiconductors & Semiconductor Equipment Industry

In today's fast-paced and highly competitive business world, it is crucial for investors and industry followers to conduct comprehensive company evaluations. In this article, we will delve into an extensive industry comparison, evaluating Micron Technology (NASDAQ:MU) in relation to its major competitors in the Semiconductors & Semiconductor Equipment industry. By closely examining key financial metrics, market standing, and growth prospects, our objective is to provide valuable insights and highlight company's performance in the industry.

Micron Technology Background

Micron is one of the largest semiconductor companies in the world, specializing in memory and storage chips. Its primary revenue stream comes from dynamic random access memory, or DRAM, and it also has minority exposure to not-and or NAND, flash chips. Micron serves a global customer base, selling chips into data centers, mobile phones, consumer electronics, and industrial and automotive applications. The firm is vertically integrated.

Company	P/E	P/B	P/S	ROE	EBITDA (in billions)	Gross Profit (in billions)	Revenue Growth
Micron Technology Inc	27.25	5.49	7.65	9.28%	$8.35	$7.65	56.65%
NVIDIA Corp	46.69	38.56	24.78	29.14%	$38.75	$41.85	62.49%
Broadcom Inc	73.42	20.43	26.60	11.02%	$9.86	$12.25	28.18%
Taiwan Semiconductor Manufacturing Co Ltd	31.07	9.77	13.45	9.44%	$691.11	$588.54	30.31%
Advanced Micro Devices Inc	112.59	5.76	10.96	2.06%	$2.11	$4.78	35.59%
Qualcomm Inc	34.88	8.83	4.36	-12.88%	$3.51	$6.24	10.03%
Intel Corp	602.67	1.62	2.98	3.98%	$7.85	$5.22	2.78%
Texas Instruments Inc	32.26	9.68	9.39	8.21%	$2.24	$2.72	14.24%
Analog Devices Inc	60.87	4.02	12.51	2.32%	$1.47	$1.94	25.91%
ARM Holdings PLC	143.01	15.98	26.95	3.3%	$0.22	$1.11	34.48%
Marvell Technology Inc	30.45	5.22	9.64	13.84%	$2.58	$1.07	36.83%
NXP Semiconductors NV	27.84	5.64	4.77	6.43%	$1.11	$1.79	-2.37%
Monolithic Power Systems Inc	24.45	12.80	17.25	5.12%	$0.21	$0.41	18.88%
ASE Technology Holding Co Ltd	31.62	3.37	1.72	3.56%	$32.4	$28.88	5.29%
First Solar Inc	20.89	3.24	5.79	5.19%	$0.61	$0.61	79.67%
Credo Technology Group Holding Ltd	129.47	21.09	36.03	7.99%	$0.09	$0.18	272.08%
STMicroelectronics NV	45.03	1.30	2.06	1.33%	$0.31	$1.06	-1.97%
ON Semiconductor Corp	75.45	2.80	3.72	3.22%	$0.44	$0.59	-11.98%
United Microelectronics Corp	14.92	1.76	2.64	4.29%	$30.07	$17.62	-2.25%
Tower Semiconductor Ltd	70.79	4.83	9.17	1.9%	$0.13	$0.09	6.79%
Lattice Semiconductor Corp	382.85	14.83	21.38	0.4%	$0.01	$0.09	4.92%
Rambus Inc	44.99	7.89	15.15	3.84%	$0.08	$0.14	22.68%
Average	96.96	9.5	12.44	5.41%	$39.29	$34.15	32.03%

After examining Micron Technology, the following trends can be inferred:

• At 27.25, the stock's Price to Earnings ratio is 0.28x less than the industry average, suggesting favorable growth potential.

• Considering a Price to Book ratio of 5.49, which is well below the industry average by 0.58x, the stock may be undervalued based on its book value compared to its peers.

• With a relatively low Price to Sales ratio of 7.65, which is 0.61x the industry average, the stock might be considered undervalued based on sales performance.

• The company has a higher Return on Equity (ROE) of 9.28%, which is 3.87% above the industry average. This suggests efficient use of equity to generate profits and demonstrates profitability and growth potential.

• The company has lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $8.35 Billion, which is 0.21x below the industry average. This potentially indicates lower profitability or financial challenges.

• Compared to its industry, the company has lower gross profit of $7.65 Billion, which indicates 0.22x below the industry average, potentially indicating lower revenue after accounting for production costs.

• The company is experiencing remarkable revenue growth, with a rate of 56.65%, outperforming the industry average of 32.03%.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio provides insights into the proportion of debt a company has in relation to its equity and asset value.

Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.

When evaluating Micron Technology alongside its top 4 peers in terms of the Debt-to-Equity ratio, the following insights arise:

• When comparing the debt-to-equity ratio, Micron Technology is in a stronger financial position compared to its top 4 peers.

• The company has a lower level of debt relative to its equity, indicating a more favorable balance between the two with a lower debt-to-equity ratio of 0.21.

Key Takeaways

For Micron Technology in the Semiconductors & Semiconductor Equipment industry, the PE, PB, and PS ratios are low compared to peers, indicating potential undervaluation. On the other hand, the high ROE and revenue growth suggest strong performance relative to industry standards. However, the low EBITDA and gross profit levels may require further investigation to understand the company's operational efficiency and profitability.

This article was generated by Benzinga's automated content engine and reviewed by an editor.