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Actionable news in SOXX: iShares Goldman Sachs Semiconductor Index Fund,

Some Of Micron's Dynamics Are Telling Us Another Story

Some other aspects beside financial reports that tell a different story.

Why the cyclical nature of the semiconductor industry is a key factor in Micron's future.

How new technologies will create more intrinsic value for Micron.

William Shockley and his work associates introduced us to the "modern" transistor over 60 years ago, and since then, ingenuity and innovation has allowed us to accomplish some truly impressive feats. Today the demand for better, faster and cheaper memory still remains as one of the most important economic drivers in the U.S. (and globally for that matter). Suppliers for this memory like Samsung (OTC:SSNLF), Qualcomm (QCOM), Micron ( MU) and Toshiba (OTCPK:TOSBF) (which is partnered with SanDisk (SNDK)) have been there to fill the demand.

I would like to focus mostly on MU because of the current position it finds itself in. With research, one will find that the semiconductor companies are driven mostly by three things: Obvious financials of price and earnings, innovation and ingenuity balanced with product output, and finally, semiconductor cyclical rates of supply and demand during bear and bull markets. The first seems to have been covered extensively here on SA with little mention of the latter two. I will however briefly try and cover some of the more important numbers currently on the books.

MU's financials are a lot like an ugly prom date, hard to look at with any sort of optimistic expectation for a future. In May, it hit its 52-week low of $9.56/share while sales took a hit of over 25% due mostly to the continued weakness in PC demand. Then in June, many jobs were cut due to a poor quarterly report, halting a relatively...


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