Micron’s (NASDAQ: MU) run has been nothing short of miraculous. The stock has surged 50% in 2018 and more than 130% over the last year.
Investors should prepare for some bigger swings from the stock when it reports earnings on Thursday, says Susquehanna derivative strategist Stacey Gilbert.
Some extra volatility and risk are being priced into this quarter, said Gilbert. Here's what she said investors should look out for.
The options market is implying a 9% move in either direction when Micron reports, higher than the typical 6% move in the previous four quarters. Micron added 4% the day after it reported first-quarter earnings in December.
She also says it looks as though there is more volatility being priced into this earnings report, but relative to its performance over the past 12 months and in the year to date, trading on Micron remains bullish.
Investors are probably using options to gain exposure or protect recent gains. Micron shares have already gained 47% this year.
Micron remains attractive to Susquehanna largely because of its shift from a commodity-type company to a focus on storage for cloud infrastructure.
Two weeks ago came word that Micron appointed Raj Talluri as senior vice president and general manager of the Mobile Business Unit.
In this role, Talluri will be responsible for leading and growing Micron’s mobile business. This includes building world-class mobile solutions to address the growing market opportunity driven by new usage models, from low-end devices to flagship smartphones. Talluri will report to Sumit Sadana, Micron's executive vice president and chief business officer.
Shares in Micron opened Tuesday down nine cents to $60.05
