What’s Keeping MU Muted Post-Earnings? Nic Puckrin on Cyclicality & Supply Crunch

Morning movers. I'm Diane King Hall live from the floor of the New York Stock Exchange. Want to dive into micron. Those shares are under pressure in an extension of some of the weakness we saw last week in the aftermath of its quarterly re despite doing better than expected. For more, we want to welcomNick Puckrin, Cross-asset analyst and founder of Coin Bureau. Nick, thank y so much for joining us t morning. Let's talk micron those shares down a little bit.n thanks for having me back a Yeah. I m wouldn't necessarily say the good times are over, but it is surprising given how the results last last week in terms of revenue hit 54 bi It was up 379% year on year. And the guidance was also stronger than expected. But despite that, you know, it fell 1% in the premarket trading and failed to rally when the markets ope So I think that Wall Street kind of still remains skeptical as to how durable the growth is going to And the earnings beat is basically it was only 5% versus, you know, 20 to 40%. But we've seen in terms of upside surprises in the past from some of these tech giants. And I think investors right now concerned mostly about the supply crunch. The industry said that it's expected to remain supply constrained for both 2027 and 2028 when itmes tI think that lastly, remember that memory is a very cyclical industry. So therefore a lot of the investors saw through that. And they know that basically there's ups and downs that come with it. I'm glad you mentioned the cyclicality and the cyclical nature of the memory space, bause there are now some who argue there's a debate going. There are some who say it is still cyclical. There are some who say it has structurally changed. What's your view? Well, t is a fair point to be made in terms of like the amount of the customers that have been locked in for micron for the coming year. You know, they've got 26 strategic cus agreements through 2030, and that accounts bout 35% of its projected projected production. So that lI think it also depends very much so on your thesis ad where the AI trade is going, because a lot of this is focused on HBM memory as opposed to regular memory, Dram, etc. So I think that a lot of the expectationsae optimists around what they view for the AI build out and the continued demand for HBM in the ne years. And then given the reaction to shares in the aftermath of its results, which, you know, i strong numbers, no matter the metric you're talking about for micron, does that show just how high the bar is for these memory names? Yeah, I would think so. I mean, when you've had these expectations versus reality, I think that investors expectations are sky high. Now in terms o potential beats. If you recall on the on the chip side, like Nvidia 2 to 3 weeks ago, where investors were the m surprise to the upside, only then did the price move. Whereasow investors are expec lot more from the beats themselves, which is yw it's good to see they still get they still come in above expectations. But now t expectation beats need to be much higher for the stock to actuallyually rally out of the beat. And then what should investors expect from AI stocks from here? Especially when you think about where yields sit. Is t still opportunity? I mean we're well above 5% on the ten year. Is there still opportunity or you where are you seeing selectivity. Well yeah I can definitely the con around high yield is going to could potentially weigh on the markets in terms of one. Hyperscalers need to fund a ma build out, you k talking about $570 billion in this year alone. And a lot of th to come from debt issuance. And they're competing e these historical swings inse o memory prices, you know, the shortage of and the the shortage right now in terms of supply could be potential issue. And they have invested about, you know, into CapEx to build out more fabs for this. But that will take some time to come online. So I think that right now you've got the the dicey macro wit regards to rates, which could weigh on potential spend. And then you have to also consider whether the fabs will come online and quick enough to actually meet the supply demands. Nick. While we hav I got to ask you about, you know, the trends in s a key part of your expertise, a significant portion of your expertise for Bitcoin. We're back above 86,000. Is the winter over? I w say at least for Bitcoin it is. I think that Bitcoin is now back on a uptrend. I think that the debasement trade is back in full force. So I think concerns around the US debt levels and the debasement of the currency and questions around fin repression is is now leading to investors to look for alternatives. And that's why gold also rallied out of these n. So Bitcoin is and now does have th strength. And there is investor allocation going into it from all range of asset allocators. The bro crypto space itself is also seeing some tailwinds. B I still think that it will remain for the next few months at least. A Bitcoin centered rally. So you say at least for Bitcoin it is. Are you worried about Ethereum for instance. I mean Ethereum has strength. I think here's demand for Ethereum right now because it's the next it's the biggest altcoin. And I in terms of the utility of Ethereum, it's beens been there's lots of companies that are issuing tokenized securities on top of Ethereu There is utility demand right there right now. But I think that the main trade right now is the debasement trade, which is why Bitcoin, as the digital gold has rallied so much over the past month or so. So it's back to being digital gold. All right. So that that view is back at the forefront. Nickthan. A look across AI an memory andkn your views on