Monday's Morning Movers: MU Taiwan Fab, QCOM Downgrade, DLTR Earnings

0:00also dying in King Halls joining us and starting with tech here looking at micron which has earnings this weekend news a lot of different forces around micron right now as you mentioned they have earnings coming up this week that got multiple analysts boosting their price targets today ahead of earnings and then they're also expanding AI memory production in Taiwan with a second facility there so let's get into that first they said they will build a second semiconductor manufacturing facility there at a site that it recently acquired from power chips semiconductor manufacturing the new facility will produce advanced DRAM and high bandwidth memory chips used in AI systems they've already completed the acquisition of this site the location has about 300,000 square feet of existing cleanroom space where they say where the chips will be produced in these tightly controlled environments it will add a second the second fab rather will add roughly another 270,000 square feet that will be built on the site it's designed to boost its capacity to

1:02supply AI memory we know that these are just really valuable right now because they're used in AI accelerators they require large amounts of high-speed memory to run the models to process data efficiently so the surge in demand as we know has boosted memory prices it's very much voted well for micron among others that you mentioned Nicole as well we've seen their shares jump majorly over the past year and year-to-day because coming into today micron shares were already up about 25% you see the move today adding another oh excuse me micron was up more than 50% year-to-day it's confusing that with a different one adding another 5% on today's move but on a year-over-year basis that stock is up more than 300% it was one of the big winners and still continues to be one of the big winners in this space even with expansion though the view is that supply may stay tight which again votes well and probably reinforces the view that the cell-side community has RBC capital raising its target on shares to 525 they've got now perform rating they're

2:06maintaining that bared antideco and both boosting their targets to 500 they've got the equivalent of a buy rating for those and so again their strength going into its results but at the same time it may mean the bar is higher Nicole yeah looking great all of those names of five six percent out for all those memory stocks is really giving a boost and the earnings are due out on Wednesday so we'll have that what about the downgrade that we saw for Qualcomm yeah it's not having a major impact on the stock but keep in mind the stock is down more than 20% so far this year it's had a rough ride so far I'm not surprised to see this because I've seen more more analysts who are you know not so enthused about Qualcomm especially given that you know it's face within tech seaport has downgraded it to a cell from a neutral they've said a hundred dollar price target on this so they see more downside risk from here once again the shares are already in a bear market this year they're treating new 52-week lows they think the smartphone market could face new pressure this

3:07year because of those rising memory costs that we just talked about and so the view is that memory prices are rising so smartphone sales could slow this year and it would just be more expensive to produce analysts expecting global smartphone volumes could fall some 10 to 15% this year manufacturers could respond by raising hands-up prices right or reducing you know the memory specs and devices that's unclear but consumers may hold on to their phones longer and like last year we had this super cycle for the iPhone for instance so the view is that you know we would not see a second year in a row of that super cycle and so that means for Qualcomm lower-chip shipments pricing pressure as well and then when I look at Dollar Tree and I see the up arrow I feel a sense of relief because some of these retailers can go one way or the other in a big way sometimes in this case we see it up about three and a half percent it's true it can go either way and honestly in the pre-market it was going both ways because initially investors were concerned about the

4:08outlook because they gave a little bit of a more cautious outlook it looks like since the earnings call investors have changed their tune in reaction to this one so as you mentioned shares are higher by about three percent on their Dollar Tree has been a winner so far this on a year-over-year basis I should say it's up more than 60 percent on the year-to-day basis it's been under some pressure in terms of the quarter they swung back into the black earning 256 per share on an adjusted basis keep in mind it posted a loss a year ago revenue was 5.45 billion so almost in line with expectation sales didn't climb overall though investors taking a look at this outlook for the year ahead they're forecasting annual sales of up to about 20.7 billion executives say that demand is strong though they talked about their budget conscious consumers were hunting for bargains there and higher income shoppers who've been turning to the chain we talked about this whether we're talking about dollar general or dollar tree the similar pattern to what we saw with

5:09Walmart several years ago the six-figure income shoppers started turning to Walmart and so executives here at these value chains are noticing a shift in how consumers are shopping and a shift in the income level of their customer base so it's not just a low-to-middle income shopper Nicole everybody loves a good bargain I guess you know thank you dying king hall great to see you we'll have a lot more movers here on Wall Street