Hi All
Micron posted excellent earnings yesterday that signals continuation of the AI stock boom that has consumed Wall Street since a year ago. Its revenue quadrupled year-on-year, even better than Wall Street's lofty expectations. After trimming 2/3 of our position in Micron after a 10x rise (which while prudent in my opinion, has lost money in hindsight), I believe our current exposure to this high-risk growth company is about right. I plan to keep this position for a while longer as it looks like memory prices will stay lofty longer than expected. Micron has already said that half of its forward revenue is locked into long-term agreements lasting 3-5 years, signalling that memory demand is here to stay.
On the flip side, evelated memory prices is very bad for Xiaomi, as its margins are squeezed due to requirements for such components in the manufacture of phones and EV. I have no doubt as to Xiaomi's resilience as a low-debt company, and its 30% drop in share price since our purchase may present an opportunity soon for further investment. As always, we keep a long-term view when it comes to deciding the makeup of our portfolio.... Show More
Not investment advice. The author may have financial interests in the mentioned instruments.
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