Fleeting Fortunes: Micron and Broadcom

by

The enthusiasm for these… “artificial intelligences,” as they are called, has, predictably, settled upon a few favored companies. Micron Technology and Broadcom, it seems, are currently enjoying the warmth of the spotlight. One wonders, naturally, how long such things last.

Micron, in particular, has seen a surge. The numbers, as they always do, tell a story, though rarely the whole one. Thirty-eight percent this year, they say. Three hundred and thirty-eight percent over the past twelve months. It’s enough to make one briefly forget the cyclical nature of these things. A three-year bull market, with returns of 84.4% annually. It’s almost… cheerful. Almost.

Broadcom hasn’t fared quite so well of late, down nearly ten percent this year. A small correction, perhaps, or the first tremor of something more substantial. Still, the longer-term numbers are similar: 73.4% over three years, 46.3% over five. Such prosperity is, of course, never evenly distributed.

They are, fundamentally, different creatures. Micron deals in memory, in the fleeting storage of data. Broadcom, in the acceleration of networks. They do not so much compete as occupy different corners of this new, digital landscape. Both, it is said, are “forever stocks.” A bold claim, and one that history tends to treat with a certain… irony.

A Slight Inclination

One must choose, it seems, even when the differences are largely matters of degree. Micron, perhaps, has a slight edge. Not a decisive one, mind you. More a… tendency. The company finds itself in what is called a “supercycle,” demand exceeding supply. A familiar story, really. Everyone wants more, and there is always a limit to what can be provided. The AI infrastructure, so eagerly constructed, now requires memory. A simple truth, easily overlooked in the frenzy.

Loading widget...

The CFO, Mr. Murphy, speaks of greater demand than supply. A comforting statement for shareholders, no doubt. He anticipates higher prices, lower costs, and favorable mixes. The usual promises. One hopes, for their sake, that they come to pass.

They have agreements in place for HBM chips, ensuring a degree of certainty. A rare thing in this business. They forecast 40% growth for these chips through 2028, reaching $100 billion. A milestone reached two years ahead of schedule. A remarkable feat, if it holds true. Though one learns to greet such projections with a quiet skepticism.

The Illusion of Value

Broadcom anticipates a doubling of AI revenue. Another impressive number. But as the mix shifts, the gross margin is expected to fall. A mere 100 basis points, they say. A trifle. Still, it’s a reminder that progress often comes at a cost. A high gross margin of 76.9% is still targeted. An almost absurd figure, really. Perhaps that’s why the stock price has faltered somewhat.

Loading widget...

The sell-off, if one can call it that, may simply be a reset. A return to something resembling reality. The P/E ratio, at 69, is still… ambitious. Micron, at 39, appears relatively reasonable. A five-year PEG ratio of 0.73 suggests it may be undervalued. These numbers, of course, tell only a partial story. The market, as always, is driven by more than just calculations.

The truth, as it often does, lies somewhere in the quiet spaces between these figures. A fleeting moment of prosperity, perhaps. Or merely another turn of the wheel. It continues, regardless. The numbers shift, the fortunes rise and fall, and the world, with a weary sigh, moves on.

Read More

2026-02-05 23:22