Micron Technology cycle-adjusted earnings valuation

Micron Technology Inc (MU)
By@hypertonx
Assumptions as of 2026-08-05
USD
Updated Aug 5, 2026 · Revised 1 time
Download Excel

Micron Technology cycle-adjusted earnings valuation

Cycle-adjusted P/E valuation for Micron Technology aligned to the portfolio maintenance instructions. The model values normalized annual earnings rather than the unusually strong FY2026 run rate. Revenue, gross margin, operating expense, tax, and dilution are explicit so the AI/HBM structural-margin thesis can be tested directly. The base normalized gross margin is deliberately below fiscal Q3 actual and fiscal Q4 guidance. Net cash is shown as a balance-sheet diagnostic but is not added again to fair value because P/E is an equity-value multiple.

as of 2026-08-05

Fair value
$1,065.53
Upside/downside
22.7%
Normalized EPS
$62.68
Normalized net income
$72.1
Implied equity value
$1,225.4
Net cash per share
$21.22

Balance sheet

24.40$B

Capitalization

1.15B shares

Market

868.52USD/share
Latest MU quote · updated Aug 11, 2026 2:00 PM MDT

Normalized earnings

58.0%
8.00$B
160.00$B
15.0%

Valuation

17.00x

Fair value vs normalized P/E and gross margin

Target normalized P/E38.0%48.0%58.0%68.0%75.0%
12.00 x$468$610$752$894$993
14.00 x$546$712$877$1,043$1,159
17.00 x$663$864$1,066$1,267$1,407
20.00 x$781$1,017$1,254$1,490$1,656
22.00 x$859$1,119$1,379$1,639$1,821

Sources

  1. Fiscal Q3 2026 revenue was $41.456B, non-GAAP gross margin was 84.9%, non-GAAP diluted EPS was $25.11, operating cash flow was $25.39B, and adjusted free cash flow was $18.3B. — investors.micron.com (accessed 2026-08-05)
  2. Fiscal Q4 2026 guidance called for $50.0B plus or minus $1.0B of revenue, approximately 86% non-GAAP gross margin, $31.00 plus or minus $1.00 of non-GAAP EPS, and approximately 1.15B diluted shares. — investors.micron.com (accessed 2026-08-05)
  3. At fiscal Q3 end Micron reported $30.2B of cash and investments, $5.7B of debt, and $24.4B of net cash; management also described 16 strategic customer agreements and approximately $27B of FY2026 net capital spending. — investors.micron.com (accessed 2026-08-05)
  4. The fiscal Q3 Form 10-Q reported 1,129,393,151 common shares outstanding as of June 17, 2026 and a $5.72B debt carrying value at May 28, 2026. — sec.gov (accessed 2026-08-05)
  5. MU market price was $918.87 at the 2026-08-05 retrieval timestamp. — nasdaq.com (accessed 2026-08-05)

Built with Modeledge MCP

Connect your MCP client to research filings and earnings calls, then build a living financial model like this one.

Connect your agent