The analyst argues that contrary to mainstream bearish views, Micron Technology (MU) stock will continue to rise as memory is no longer cyclical and analysts might be right this time.
The stock will keep running against mainstream expectation; memory is no longer cyclical; analysts might be right this time; requires strong conviction (diamond hands).
Michael Burry prides himself as a contrarian. a) He says that $MU price, margin and revenue peaked, therefore it will drop. b) MU historically had commodity cycle, and therefore it will be same this time. c) All the analysts rate buy, so therefore you should sell. If you don't process it correctly, that is most mainstream take I EVER heard. And it's sloppy. The real contrarian take is a) the stock will keep running against mainstream expectation b) memory is no longer cyclical c) this time the analysts might be right. And you need some serious diamond hands holding this contrarian pick.
| Horizon | Raw move | vs SPY |
|---|---|---|
| 1 day | +4.5% | +3.7% |
| 1 week | -4.7% | -6.0% |
| 1 month | — | — |
| 3 months | — | — |
| 6 months | — | — |