Micron through-cycle FCF yield valuation

Micron Technology Inc (MU)
By@grokius
Assumptions as of 2026-09-30
USD
Updated Sep 30, 2026 · Revised 2 times
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Micron through-cycle FCF yield valuation

Through-cycle unlevered FCF yield for Micron. Peak FY2026 and Q1 FY2027 run-rate earnings (Q4 revenue $54.2B / 87% GM; Q1 guide $61.5B / ~86% GM) are shortage prints, not the capitalized cash earnings. Normalized FCF sits between prior-cycle peak FCF of $8.5B (FY2018) and peak quarterly run-rates, reflecting HBM mix and SCA floor margins well above historical peaks, after mid-cycle net capex. Net cash excludes SCA customer deposits (financing liability). Q4 print confirmed tighter 2027-2028 supply and expanded SCAs; FY2027 construction CapEx is rising.

as of 2026-09-30

Fair value per share
$1053.12
Through-cycle unlevered FCF
52,000
NTM FCF
88,000
NTM EBITDA
175,000
Implied equity value
1,211,083
Implied share price
$1053.12
Upside vs current price
2.3%
Current EV to NTM EBITDA
6.44
Implied EV to NTM EBITDA
6.60
Through-cycle FCF yield at market EV
4.6%

Capital structure

1,150millions
-55,527USD millions

Earnings power

52,000USD millions
52,000USD millions
140,000USD millions
175,000USD millions

Market

1029.00USD
Latest MU quote · updated Oct 9, 2026 2:00 PM MDT

Valuation

4.5%

FCF bridge ($M)

FY2024FY2025FY2026
Reported or through-cycle FCF62,30862,30862,308

Sources

  1. Fiscal Q4 2026 (ended 3 Sep 2026) revenue $54.229B, GAAP diluted EPS $32.87, non-GAAP diluted EPS $33.42, non-GAAP GM 87.0%, CFO $43.973B, investments in capex net $10.774B, adjusted FCF $33.199B. FY2026 revenue $133.188B, non-GAAP EPS $75.52, CFO $89.675B, net capex $27.367B, adj FCF $62.308B. Cash+marketable+restricted $73.48B; diluted shares ~1.15B. Q1 FY2027 guide: revenue $61.5B +/- $1.5B, non-GAAP GM ~86.25%, non-GAAP EPS $38.15 +/- $1.00, non-GAAP opex ~$2.06B. — sec.gov
  2. Q4 FY2026 8-K Item 2.02 (acc 0000723125-26-000018) announcing record Q4 and FY2026 results; Exhibit 99.1 press release. — sec.gov
  3. Q4 call 30 Sep 2026: 26 SCAs (>35% of revenue through 2030); RPO ~$150B; SCA cash deposits $12.7B (financing, not FCF); net cash $68.3B before deposit adjustment; Q1 CapEx ~$11.5B and 1H FY2027 CapEx ~$25B with 2H higher and construction CapEx growing faster; FY2027 sequential revenue growth each quarter; Q1 GM is FY2027 floor; memory/storage much tighter in calendar 2027 and 2028 than 2026; no line of sight to supply-demand balance; >75% of 2027 output already committed. — investors.micron.com
  4. Q4 balance sheet: cash $38.364B, ST investments $5.070B, LT marketable $30.019B (sum $73.453B); current debt $0.491B + LT debt $4.688B = $5.179B; noncurrent customer contract liabilities $12.895B. Net cash excluding SCA deposits ~$55.5B (model net_debt -$55.527B). — sec.gov
  5. Through-cycle basis unchanged: do not capitalize peak Q4/Q1 EPS or annualize $33B quarterly FCF. Prior-cycle peak FCF FY2018 $8.5B. SCA floors still imply mid-cycle margins above historical peaks, but rising FY2027 construction CapEx offsets raising normalized FCF on this print. — investors.micron.com
  6. Live MU quote $1,065.11 at 30 Sep 2026 close (provider timestamp 20:00:01Z). — finance.yahoo.com

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