Shares of Micron Technology Inc. (MU, Financial) soared 4.78% to $42.05 in after-hours trading on Wednesday after reporting second-quarter 2019 results.Â
The Boise, Idaho-based producer of semiconductor memory posted adjusted earnings of $1.71 per share, which was down 39.4% from the prior-year quarter. The company beat estimates of $1.67.Â
Revenue declined 20.5% from the year-ago quarter to $5.84 billion, but beat expectations by $20 million.
For the quarter, the non-GAAP gross margin was 50.2% of revenue, down 8.2 percentage points from the prior-year quarter.
The non-GAAP operating margin was 36.2% of revenue, down 13.2 percentage points from the comparble period of 2018.Â
Non-GAAP operating income decreased 41.9% year over year to $2.11 billion.
Micron Technology also recorded a 21% decrease in cash flow from operations to $3.44 billion. The company spent $2.45 million in capital expenditures during the quarter, so the resulting adjusted free cash flow was $988 million.
Under its $10 billion share repurchase program, the company bought back 21 million outstanding common shares for a total amount of $702 million.
Including restricted cash, Micron's balance sheet had $9.22 billion in cash on hand and short- and long-term securities, and a net cash position of $2.99 billion as of Feb. 28.
Micron Technology was trading around $40.13 per share at close on Wednesday for a market capitalization of $45 billion. After a 32% decline for the 52 weeks through March 20, the share price is now substantially below the 200-day simple moving average line, slightly above the 50-day line and significantly above the 100-day line.
The closing price on Wednesday was 41.2% above the 52-week low of $28.39 and 61.2% below the 52-week high of $64.66.
Wall Street issued an overweight recommendation rating, meaning analysts expect the stock to outperform either the industry or the overall market. The average price target of $47.65 represents an 18.74% upside from the closing price on Wednesday.
In addition, the 14-day relative strength index of 54.22 suggests the stock is neither oversold nor overbought.
Disclosure: I have no positions in any securities mentioned.
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