Investing

Earnings Previews: Carnival, Micron, Nike

Micron

Shares of semiconductor maker Micron Technology Inc. (NASDAQ: MU) have lost more than 32% over the past 12 months. Since reaching a 52-week high in early January, the stock has dropped by more than 45%.

Earlier this month, analysts at BNP Paribas gave the stock an Outperform rating and a $75 price target, noting the company’s DRAM and flash memory process expertise. On Tuesday, J.P. Morgan reiterated an Outperform rating while lowering its $80 price target to $65. Weaker demand for the company’s products due to higher interest rates and recession fears weigh on Micron, as they do on most tech hardware stocks.

Of 36 analysts covering the stock, 28 have a Buy or Strong Buy rating and another six rate the shares at Hold. At a share price of around $50.60, the upside potential based on a median price target of $70 is about 38.3%. At the high target of $110, upside potential is 117.4%.

Fiscal fourth-quarter revenue is forecast at $6.78 billion, down 21.6% sequentially and by 18.0% year over year. Adjusted EPS are forecast at $1.39, down 46.5% sequentially and 74.1% lower year over year. For the full 2022 fiscal year ended in August, revenue is currently forecast at $30.88 billion, up 11.5%, and EPS is forecast at $8.29, up 36.8%.

Micron stock trades at 6.1 times expected 2022 EPS, 12.2 times estimated 2023 earnings of $4.16 and 8.2 times estimated 2024 earnings of $6.16 per share. The stock’s 52-week range is $48.45 to $98.45, and Micron pays an annual dividend of $0.46 (yield of 0.93%). Total return over the past 12 months was negative 32.3%.

Nike

Over the past 12 months, shares of athletic gear maker Nike Inc. (NYSE: NKE) have declined by about 35%. For the year to date, the Dow component is the second-worst performer, down more than 42%, and down 44% since its 52-week high posted lasted November. The company boosted its direct-to-consumer business sharply during the worst of the pandemic, but growth there has stalled, and sales from physical stores are not so hot for any retailer right now. The prognosis is not encouraging either. Nike has had a tough year, and hopes for the next one are just that — hope.

Analyst sentiment on the stock has declined over the past couple of quarters. Of 33 brokerages covering the Dow stock, 22 (down from 28 of 34 two quarters ago) rate the shares a Buy or Strong Buy. The rest have Hold ratings. At a share price of around $96.30, the upside potential based on a median price target of $125 is about 29.8%. At the high price target of $185, the implied upside is 92.1%.


For the company’s first quarter of fiscal 2023, revenue is expected to come in at $12.29 billion. That would be 0.4% higher sequentially and essentially flat year over year. Adjusted EPS are forecast at $0.92, down 7.5% sequentially and by 20.7% year over year. For the full fiscal year ending in May, estimates call for EPS of $3.72, down 12.8%, on sales of $49.97 billion, up about 7%.

Nike stock trades at 25.9 times expected 2023 EPS, 21.4 times estimated 2024 earnings of $4.49 and 17.7 times estimated 2025 earnings of $5.43 per share. The stock’s 52-week range is $95.00 to $179.10. Nike pays an annual dividend of $1.22 (yield of 1.26%). Total shareholder return for the past year was a negative 34.3%.

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