Shares of Micron Technology (NASDAQ:MU) rose 20.5% in January, according to data from S&P Global Market Intelligence. The bulk of Micron's gains came after an influential analyst firm gave the memory-chip maker's stock a bullish nod based on a positive analysis of the semiconductor market as a whole.
J.P. Morgan analyst Harlan Sur argued that the worst may be over for a struggling chip sector. If the market hasn't bottomed out yet, Sur said, the bottom should be close from his vantage point in mid-January.
Chip stocks have suffered plunging share prices over the last year or so, priming many of them for sharp rebounds. J.P. Morgan singled out Micron Technology as one of its top picks under these circumstances.
J.P. Morgan is not the first analyst firm to find signs of a market bottom for chipmakers in general, nor the first to predict surging business for Micron in particular. That being said, all of these potential gains are subject to lots and lots of assumptions and moving parts, including a unique geopolitical angle these days. That's why even bullish analysts like Sur have to couch their optimistic predictions in cautions and caveats.
That being said, Micron does seem to be spring-loaded for a sharp bounce one of these days. Whether the rebound is triggered next week, next month, or next year, we Micron investors should be able to collect solid gains starting from today's share price.