Is Micron Technology Inc (MU) overvalued?
On Equity Rank's model estimate, MU trades 60% above its fair value. Micron Technology Inc (MU) last closed at $690.00; the multi-method model fair value is $429.95.
| Price | Model fair value | Price vs model |
|---|---|---|
| $690.00 | $429.95 | 61% above |
What the answer rests on
- 3 of 11 valuation methods put MU's value above its price and 8 put it below, so the methods disagree.
- To justify today's price, MU's free cash flow would need to grow about 6.2% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew -18.8% a year.
- Over the past year the price sat below the model fair value on 17% of trading days. The gap ranged from 21% below to 180% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind MU's fair value · What prices assume · Other companies