Chip Stock Falls on Mixed Q1 Forecast

The company also anticipates higher-than-expected operating expenses

Deputy Editor
Nov 28, 2023 at 1:35 PM
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The shares of Micron Technology Inc (NASDAQ:MU) are down 2.9% at $75.30 this afternoon, even after the computer memory and data storage firm hiked its first-quarter adjusted gross margin. The company expects to approach breakeven, thanks to improved supply and demand balance.

Weighing on the equity today instead is estimates that operating expenses will be higher than previously forecast. In response, the stock is pulling back from its Nov. 20 more than 12-month high of $78.91, but it still boasts a respectable 50.7% year-to-date lead. The $74 level is also keeping today's dip in check, helping MU maintain a 12.5% November gain.

MU November 272023

The options pits are optimistic. Over at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Micron stock sports a 10-day call/put volume ratio of 1.70 that stands higher than 86% of readings from the past year. This means calls have been getting picked up at much quicker-than-usual clip of late.

Those that want to take advantage of today's pullback and join these bullish traders should consider options. The stock is seeing attractively priced premiums at the moment, per its Schaeffer's Volatility Index (SVI) of 31% that sits in the 14th percentile of its annual range. This implies options traders are pricing in low volatility expectations at the moment.


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