The Motley Fool Take
Micron Technology is a leading manufacturer of Dynamic Random Access Memory (DRAM) products used in consumer PCs and mobile devices, and its products are increasingly being used in cloud servers, industrial and other enterprise markets. DRAM accounts for nearly three-quarters of Micron’s total sales. Micron is also a leading supplier of NAND flash storage devices used in solid state drives, which make up 24% of its business.
Micron’s business is cyclical and its prices rise and fall based on supply and demand. During the Q3 results conference call, CEO Sanjay Mehrotra cited “strong demand in almost all end markets,” including PC, data center, smartphone and 5G. Mehrotra said Micron has so much automotive demand that it can’t keep up, and he also pointed to strong demand in industrial markets.
Semiconductor shortages are currently causing demand to exceed supply, and this could continue into calendar year 2022. But even when the supply shortage is finally resolved, Mehrotra expects demand to continue to grow.
Micron has been a volatile stock in the past, but its stock has grown more than 1,000% over the past decade. Given the frequent fluctuations in memory prices, this is one stock to get right when buying stocks. With Micron’s forward-looking P / E ratio lately close to 7, this looks like a promising time for long-term investors.
Ask the fool
From CD in Odessa: What is the “Internet of Things”?
The fool answers: You may have noticed that a lot of “smart” things are connected to the Internet and often can be controlled by apps on your phone. This is the Internet of Things (IoT). For example, your doorbell can be connected to your home Wi-Fi network so you can monitor and respond to it from anywhere. You may also be able to turn lights on and off and set your thermostat via the internet thanks to connected devices, and your watch may also transmit fitness information wirelessly. Refrigerators and washing machines are now also part of the IoT.
The IoT potentially encompasses almost any object that can be connected to the Internet in order to be controlled or to transmit information.
From GN, Bay City, Michigan: How do I know if a company is paying a dividend?
The fool answers: The best thing to do is to simply call the company, ask about investor relations and inquire about dividend payments. It’s even easier to look up the company on online stock listings, which usually include each dividend and, if one is paid, the current dividend yield. Note, however, that these websites may not contain the latest information.
A company’s dividend yield is more meaningful than its dividend amount because you can compare the payouts of different companies in an apple-to-apple way. The return is the percentage of the current share price that is paid out annually in the form of dividends. It is calculated by dividing four quarters of dividend payments by the current share price. So a company that pays 50 cents a quarter ($ 2 a year) and trades at $ 40 per share would have a return of 5% ($ 2 divided by $ 40).
The school of the fool
It is important for investors and potential investors in the stock market to understand that there are a wide variety of ways to invest. Here’s a look at some popular approaches. See which ones are best for you.
Dividend investment: Dividend investors look for income from their holdings, so they tend to look for stocks with generous dividend payouts and / or a track record of regular and significant dividend increases. This is a powerful strategy because dividends from healthy and growing companies are likely to rise over time and paid out in good and bad economies alike.
Value investing: Value investors want to buy stocks at prices that are below their intrinsic value. Buying undervalued stocks builds a margin of safety and can reduce the chance of being burned by a falling stock. Big investors like Warren Buffett have been focusing on value for decades.
Growth investments: Growth investors, on the other hand, pay less attention to value and instead look for fast-growing companies. They’re more willing to buy what appear to be overvalued stocks in the hopes that the price will continue to rise.
Large-cap investments: This style focuses on large companies that have grown big by implementing strategies over time. They are more tried and tested and contain many blue chip names.
Small cap investments: Small businesses can be riskier, but they can also usually grow faster than large ones. They can be pretty new and may not even be profitable.
Invest in mutual funds: Investors who don’t want to study stocks and make buying and selling decisions themselves can simply park their dollars in mutual funds and leave most of the work to the fund managers. Index funds can be your best bet here as they tend to outperform their more actively managed counterparts over long periods of time.
Note that you don’t have to adopt just one style of investing. For example, many large-cap stocks have solid dividend yields, while some fast-growing companies can also have undervalued stocks. It can also be a good idea to diversify your portfolio with both large and small companies.
My stupidest investment
From CD, online: I bought shares in Rite Aid right before the announcement that it would merge with Walgreens. One day it was up 35% and I just stared at it in amazement. I did not sell or place a stop loss order to hedge the profit. I’ve watched it go way below the advertised purchase price. I thought it would be easy to buy money and hold it for a month or two to complete the acquisition, so I raised my position significantly. Well, the takeover ran into trouble, the price was lowered, and the merger did not materialize. I ended up losing over 70% on the largest single stock in my portfolio. Lessons Learned: 1. Don’t step in front of a steamroller to pick up a dime. 2. If a stock is up 40% in one day, don’t think twice: sell it, take the money, and run.
The fool answers: It is never worth risking death on the steamroller for a penny. But think twice before selling a successful stock, because the best companies (and their stocks) will keep growing over time. The proposed merger between Rite Aid (which was struggling) and Walgreens Boots Alliance was heavily criticized, and many expected the Federal Trade Commission to reject it. So the deal was changed, with Walgreens buying about half of Rite Aid’s businesses for $ 5.2 billion.
Who am I?
My roots go back to 1928 when William Boeing and others founded me as an “Aircraft & Transport” company. I soon started buying other airlines – and merged with Continental Airlines in 2010. In 2012, I was the first North American airline to fly Boeing’s 787 Dreamliner. My parent company owned Westin International, Hertz and Hilton International for a while. Today, based in Chicago and with a current market value of over $ 15 billion, I am the third largest airline in the United States with the world’s most extensive route network. I serve more than 350 airports in 48 countries. Who am I?
Don’t you remember last week’s question? Find it here.
Last week’s quiz answer: L’Oreal