Chipmaking stocks are bleeding post Micron Technology, Inc's (NASDAQ:MU) cautious Q4 guidance.
Piper Sandler saw DRAM, and NAND pricing decline, affecting Micron as mobile and notebook end-markets face continued weakness based on inSpectrum's June monthly memory contract pricing data.
Piper Sandler also shared how semiconductor equipment stocks may become range-bound in a decelerating or declining memory CAPEX environment.
It pointed out Lam Research Corp (NASDAQ:LRCX) with higher relative exposure to memory CAPEX, followed by Applied Materials, Inc (NASDAQ:AMAT), KLA Corp (NASDAQ:KLAC), and ASML Holding N.V. (NASDAQ:ASML).
Piper Sandler had downgraded Micron, citing its dependence on DRAM, battling price declines for most configurations, and significant exposure to consumer-like markets such as PCs and mobile, which get hammered during an economic slowdown.
Mizuho also shared a similar opinion.
Earlier this month, Advanced Micro Devices, Inc (NASDAQ:AMD) warned against a slowdown in the PC market after two solid years amid the pandemic.
Gartner also shared how China's economic slowdown and inflation-led drop in consumer spending will likely weigh on the global shipments of computers and smartphones in 2022. All of which will affect companies ranging from Nvidia Corp (NASDAQ: NVDA) to Apple Inc (NASDAQ: AAPL) and Microsoft Corp (NASDAQ: MSFT), set to announce their quarterly earnings starting in July.
Premarket Price Actions: MU traded lower by 4.45% at $52.82, ASML down by 3.93% at $457.20, TSM down by 3.6% at $78.81, United Microelectronics Corp (NYSE: UMC) shares falling by 3.1% at $6.56, Western Digital Corp (NASDAQ: WDC) down 3.64% at $43.20, Nvidia -1.65% at $149.30, Qualcomm Corp (NASDAQ: QCOM) -1.71% at $125.55, and AMD -1.75% at $75.13.
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