What did you trade today and why?

[NW-Bound]

MUU hit its new high on 6/3 at 3:30 pm of $1081.71 at the exact same time MU hit its new high of $1089.29.
I'm not seeing what you described?

Right. I was talking about near market close on 6/5.

 

[NW-Bound]

I sold three NVDA puts near market close yesterday ($200 strike, June 18 expiration) for a total of $1,290. Will be interesting to see if the semiconductor stocks continue their plunge or if the sentiment turns to "oversold" next week and we get some recovery. I'm certainly hoping for the latter. It would be nice, though, to see NVDA bottom out around $195 so my puts get assigned, facilitating some juicy CC sales.

This is the kind of puts I write, although I usually do just one week out. Whether the options get assigned or not, I am ok with the outcome.

And I usually sell options on positions I already hold long-term, in order to add or to reduce the number of shares if the options get assigned.

 

[Fishmasterdan]

For you chip followers. This came across today. Also For those following space X IPO. It looks like a few brokers are letting use retail traders buy some shares. I put in a request for 150 shares. they are being offered at 135$.

 

[Al18]

I own FSELX, which is 9.1% Marvell

 

[NW-Bound]

Marvell is not a small company. Its current market cap is about the 50th in the S&P 500. Even before its recent meteoric rise, it was not small either.

Never heard of Flex, but I used to have Flextronics back in 2000. Just looked it up, and yep, it's the same company with a name shortening.

PS. I used to have both Flextronics and Sanmina in 2000. Both were contract electronic manufacturers. After the Internet burst, I sold both, and have not followed them since. Just now, found out that Flextronics recovered much better than Sanmina. The latter still has not recovered to its 2000 high.

 

[finnski1]

Right. I was talking about near market close on 6/5.

still confused the ATH happened on wed 6/3 at $1089. The highest I see near close on 6/45 was around $706.
Not that it matters and I'm not trying to argue, just didn't see that blip on my graph.

 

[NW-Bound]

still confused the ATH happened on wed 6/3 at $1089. The highest I see near close on 6/45 was around $706.
Not that it matters and I'm not trying to argue, just didn't see that blip on my graph.

Perhaps the Web site you use missed this blip. Or just as likely, Yahoo Finance where I saw this blip got a bad data point.

In any case, I have captured what I saw to share here.

 

[Semi-Retyrd]

Wednesday after hours I thought Mu was a possible buy as it went down 7% on the Broadcom news and other reasons. Well 2 days later it close down almost another 40%! Yikes.

With MU like any stock you should only buy it when it is selling at less than its intrinsic value by a reasonable margin of safety. The trick is what the heck is its intrinsic value. According to M*, MU;s fair value is $455. Since it is a high volatility stock a 20% margin of safety might be in order. So .8x455 or $364 would be a reasonable entry price.

Thus you should enter a limit order at $364 for however many shares you wish to buy. Since the current price of MU is around $864, your order will be filled approximately three years from now.

 

[finnski1]

With MU like any stock you should only buy it when it is selling at less than its intrinsic value by a reasonable margin of safety. The trick is what the heck is its intrinsic value. According to M*, MU;s fair value is $455. Since it is a high volatility stock a 20% margin of safety might be in order. So .8x455 or $364 would be a reasonable entry price.

Thus you should enter a limit order at $364 for however many shares you wish to buy. Since the current price of MU is around $864, your order will be filled approximately three years from now.

Yeah, I meant to say MUU went down 40% in a few days, MU "only" went down 20%.

Perhaps the Web site you use missed this blip. Or just as likely, Yahoo Finance where I saw this blip got a bad data point.

In any case, I have captured what I saw to share here.

Yeah. I use thinkorswim which is the Schwaab platform (used to be TD Ameritrade) that I've used forever. Don't see it on there. Regardless, it's been a wild ride on MU/MUU the last few weeks.

 

[NW-Bound]

With MU like any stock you should only buy it when it is selling at less than its intrinsic value by a reasonable margin of safety. The trick is what the heck is its intrinsic value. According to M*, MU;s fair value is $455. Since it is a high volatility stock a 20% margin of safety might be in order. So .8x455 or $364 would be a reasonable entry price.

Thus you should enter a limit order at $364 for however many shares you wish to buy. Since the current price of MU is around $864, your order will be filled approximately three years from now.

Fair market values of any asset are highly subjective. Analysts can pull up all sorts of rationale and projection to back up all sorts of claim. What I have learned is to be a bit contrarian, and do not follow the crowd. A bit of skepticism can save one's skin.

 

[Al18]

MU Nav lost 8 days of gains - that's all.

 

[Qs Laptop]

With MU like any stock you should only buy it when it is selling at less than its intrinsic value by a reasonable margin of safety. The trick is what the heck is its intrinsic value. According to M*, MU;s fair value is $455. Since it is a high volatility stock a 20% margin of safety might be in order. So .8x455 or $364 would be a reasonable entry price.

Thus you should enter a limit order at $364 for however many shares you wish to buy. Since the current price of MU is around $864, your order will be filled approximately three years from now.

This technique totally ignores the future earnings potential of MU. The company is building a huge semiconductor fab in New York because they have over 2 years of orders in the pipeline on backorder. That gives them incredible pricing leverage.

The consensus full year earnings per share are:
2026: $59 per share
2027: $105 per share
2028: $115 per share

And here is their historical full year EPS:
2023: -$5.34
2024: $0.70
2025: $7.59

They have a profit margin of 42%.

Suffice it to say the price will likely not be getting anywhere near $364. And I have no idea where you plucked the idea that it would be $364 three years from now.

 

[copyright1997reloaded]

A couple fun observations.....I really have no opinion:
1. Morningstar that is supposed to be okay on stock stuff asserts a reasonable value for SpaceX is about half the IPO price. (But it will no doubt soar to start.)
2. Although a large 30% will be allocated to retail, you are unlikely to much or any of your order. (If you get 100%, look out!)
Regards, Dick
PS. Think how exciting it will be when a big IPO comes for a company that can make money!

Re: Bolded above - this is my fear.

 

[NW-Bound]

I had 300 shares of MU bought quite a few years ago. "Lost" them a few months ago via covered calls getting assigned at prices in the $300-$350 range. MU dropped big last week, but still closed at 864. I left beaucoup money on the table.

Now, I read the classic "The battle for investment survival" by Gerald Loeb (1891-1974), a founding partner of E.F. Hutton. Loeb wrote that it's OK to buy back a stock at a higher price than what you sold off prematurely, as long as new conditions warrant it.

I always knew MU business was booming, and it had a wonderful profit margin and back orders. Same as SK Hynix and Samsung. What I ponder is what happens after all these AI centers that are announced get built. And some plans have been reported delayed.

Do these wonderful, fast, and expensive memory chips wear out and need to be replaced? At what rate? Do they keep building more and more of these centers whose total cost is already in the trillion? How many trillions do hyperscalers have to keep putting up AI centers? How many AI centers does the world need and can use?

I know so little to answer the above questions, and my background and career as an EE is of no help. So, I have not bought back MU, and are now low-balling it with OTM puts.

 

[copyright1997reloaded]

What are you guy's thoughts on AVGO (Broadcom)? I won't hold you to any opinion but is it getting into reasonable territory for a buy (or not yet)?

Disclaimer: I have had (and continue to have) large bets on semi stocks. I own a fairly large slug of ADI (from LLTC which was my first big winner), MRVL (some w/a cost basis around $8), some ARM, QCOM and even a little INTC I picked up on the cheap.

Having said the above, this industry is in general cyclical. Boom and bust. Double/triple ordering, cancelled orders on downturns, etc. Some of that depends on where in the semi orbit a company is, e.g. more generic plays like memory vs. long cycle items (e.g. some analog).

AVGO is one of the ones I missed. I had hoped (now long ago) that their purchase of QCOM would have happened, and I even sold some QCOM when they were fighting the AVGO takeover. Foolishly, I didn't put those $ into AVGO. AVGO is up (even after Friday) 731% in the past five years. IF we have a semi-conductor downturn, AVGO is likely to go down (as will my MRVL, QCOM, and even ADI). AVGO was also as low as $293 in April (2026), so still up 36% from that recent low. So...for me at least...I would wait.

 

[Montecfo]

Re: Bolded above - this is my fear.

Yes. This might be the most publicized IPO since Google. I feel like the move of allocating shares to retail maybe in the hopes of getting the shares into the hands of long-term holders to limit downside price action.

There is I'm sure a sense among some that this can be like Tesla where the stock spins a period of time trading completely out of the orbit if you will of what most folks see from the company fundamentally.

I do hope in some ways that people moving money to SpaceX will take the air out of a few stocks that I'd like to buy at lower levels.

 

[dickoncapecod]

Yes. This might be the most publicized IPO since Google. I feel like the move of allocating shares to retail maybe in the hopes of getting the shares into the hands of long-term holders to limit downside price action.

There is I'm sure a sense among some that this can be like Tesla where the stock spins a period of time trading completely out of the orbit if you will of what most folks see from the company fundamentally.

I do hope in some ways that people moving money to SpaceX will take the air out of a few stocks that I'd like to buy at lower levels.

Excitement is high, however I think the issuer was hoping S&P would cave in and force price insensitive index buyers, thus sorta legitimizing an inflated price. No such luck. (It will be included in QQQ --- the listing exchange LOL.) Serious investors will ultimately have to guess the NPVs of orbiting server farms and Mars colonies and who knows what else as well as rocket launches that maybe are turning a modest profit. It's an understatement to say Visionary Musk is a mercurial CEO, and his Asbergers is likely to further impact his behavior as he grows older. I think it's fair to say that the IPO price is in large measure a bet on a visionary tech evangelist.
The huge marginal cash flows attendant to the IPO will be interesting regardless of what price it trades at after the open on Weds.
Regards, Dick

 

[NW-Bound]

^^^^ I never participated in any IPO. This one, I will also be watching from the sideline, albeit with much more interest than I did others such as Facebook, Twitter IPOs, etc...

 

[Spock]

...

Do these wonderful, fast, and expensive memory chips wear out and need to be replaced? At what rate? Do they keep building more and more of these centers whose total cost is already in the trillion? How many trillions do hyperscalers have to keep putting up AI centers? How many AI centers does the world need and can use?

...

DRAM doesn't really "wear out".
Flash memory (ex. the stuff in thumb drives or SSDs) does have a limited number of write cycles.
So it depends on which memory the AI systems are consuming.

 

[NW-Bound]

DRAM doesn't really "wear out".
Flash memory (ex. the stuff in thumb drives or SSDs) does have a limited number of write cycles.
So it depends on which memory the AI systems are consuming.

Right. HBMs are DRAM. Wear out is the wrong word to use. I should have said "burn out" or "fail" and need replacement.

 

[Semi-Retyrd]

This technique totally ignores the future earnings potential of MU. The company is building a huge semiconductor fab in New York because they have over 2 years of orders in the pipeline on backorder. That gives them incredible pricing leverage.

The consensus full year earnings per share are:
2026: $59 per share
2027: $105 per share
2028: $115 per share

And here is their historical full year EPS:
2023: -$5.34
2024: $0.70
2025: $7.59

They have a profit margin of 42%.

Suffice it to say the price will likely not be getting anywhere near $364. And I have no idea where you plucked the idea that it would be $364 three years from now.

No plucking. Please read the following -

https://www.morningstar.com/stocks/this-ai-winner-has-been-unstoppable-is-it-time-sell

Having been through the boom and bust cycles in memory over the past 30 years, what we are seeing now is not new.

Of course, maybe I am wrong. Maybe things are different this time. Each of us needs to reach our own conclusions.

Cheers, Dennis

 

[Qs Laptop]

No plucking. Please read the following -

https://www.morningstar.com/stocks/this-ai-winner-has-been-unstoppable-is-it-time-sell

Having been through the boom and bust cycles in memory over the past 30 years, what we are seeing now is not new.

Of course, maybe I am wrong. Maybe things are different this time. Each of us needs to reach our own conclusions.

Cheers, Dennis

Article says MU has no moat. They make DRAM chips and are one of only 4 manufacturers--SK Hynix, Samsung, Micron, and Sandisk. That sure sounds like a moat. or at least a ditch, to me. (And Samsung is not traded on any US stock exchanges.)

Article says they see higher margins than MU in DRAM. Really?
MU has a 42% profit margin.
SNDK has a 34% profit margin.
SK Hynix is 68%
Samsung is hard to figure since DRAM chips are a segment of their business.

The article also says they expect Micron's profit margin to hit 80%.

The article says they expect MU's price to appreciate with a 200% growth in revenue, "another strong year in 2027", with growth peaking in 2028, then a "harsh down cycle in 2029." No reason is given for why there would be a harsh down cycle.

In any event, the article does not contradict my assertion that Micron has 2 years of backorders and will have strong growth for the next 2-3 years.

 

[dickoncapecod]

A POTENTIAL big picture model of the current race to spend trillion$ on AI infrastructure might be the late 90's fiber optics boom laid out nicely if you Google "late 90s fiber optics boom." EVERYONE wildly overestimated demand for transmission of internet and Telcom stuff ----- with devastating results for equity and bond fiber buikd-out investors
Just one possibility, Dick

 

[Montecfo]

A POTENTIAL big picture model of the current race to spend trillion$ on AI infrastructure might be the late 90's fiber optics boom laid out nicely if you Google "late 90s fiber optics boom." EVERYONE wildly overestimated demand for transmission of internet and Telcom stuff ----- with devastating results for equity and bond fiber buikd-out investors
Just one possibility, Dick

True enough. I mean, markets generally overshoot. So when is the top? When will the "Global Crossing" moment be?

I recall that era in that heading into 2020 I owned only one tech stock: Analog Devices. I really should go back and see how much I owned. But it fell 10% in early 2000 (Just looked it up, March 7 2000)..

in those days if I had a huge gain in a stock, my discipline was to sell if it dropped by 10%. so I sold the stock which was my largest gain in dollars and multiples of stock price to that point. 8 Or 9 bagger.over 2-3 years.

Later I was somewhat amazed how fortunate I was with timing.

Of course now stocks are so volatile particularly the high flyers, that I would have done a lot of selling to this point under that rule.

But I need some sort of rule. Does anyone have a useful "sell rule"?

 

[copyright1997reloaded]

Excitement is high, however I think the issuer was hoping S&P would cave in and force price insensitive index buyers, thus sorta legitimizing an inflated price. No such luck. (It will be included in QQQ --- the listing exchange LOL.) Serious investors will ultimately have to guess the NPVs of orbiting server farms and Mars colonies and who knows what else as well as rocket launches that maybe are turning a modest profit. It's an understatement to say Visionary Musk is a mercurial CEO, and his Asbergers is likely to further impact his behavior as he grows older. I think it's fair to say that the IPO price is in large measure a bet on a visionary tech evangelist.
The huge marginal cash flows attendant to the IPO will be interesting regardless of what price it trades at after the open on Weds.
Regards, Dick

Why the LOL on QQQ? That ETF has close to $500B in AUM. (SPY is around $800B).