Thursday night, we'll get a first-quarter 2008 update from memory and image sensor specialist Micron Technology (NYSE:MU). The last few quarters have not been kind to the company. Let's see if things look any different this time.

What Fools say:
Here's how Micron's CAPS score rates against some of its peers and competitors:

Market Cap (millions)

Trailing P/E Ratio

CAPS Rating (out of 5)

SanDisk (NASDAQ:SNDK)

$8,130

114.6

****

Infineon Technologies AG (NYSE:IFX)

$8,820

N/A

**

Micron

$5,960

N/A

**

Omnivision Technologies (NASDAQ:OVTI)

$906

25.3

****

Spansion (NASDAQ:SPSN)

$551

N/A

*

Data taken from Motley Fool CAPS on Dec. 19.

You can tell from the memory makers' nonexistent P/E ratios that it is extremely hard to turn a profit from that product line nowadays. SanDisk looks like an overvalued exception, but the results there are simply so close to breakeven that the P/E calculation blows up in a little mushroom cloud of broken logic.

Our bullish players like Micron because the stock is dirt cheap after an approximately 40% price drop year to date, and the memory market can't stay depressed forever, can it? Can it? Oh, can it. The bears complain of a management team that promises roundly and delivers flatly.

What management says:
OK, so how about the spherical promises from the last earnings call? Sales VP Mike Sadler said that memory prices were painfully low, thanks to worldwide oversupply. But "fundamentally, demand is quite strong for our products. Customers like our product portfolio and roadmap, and we're becoming much more cost-efficient in manufacturing these products." The problem should correct itself, Sadler said with reference to "anecdotal input" from makers of manufacturing equipment.

What management does:
Times haven't really been good since late 2006, though the trailing-12-month nature of these numbers masks the bad times for a while. The bright spot here is decent revenue growth in the face of end-product pricing in free-fall, while the worst point is the massive cash hemorrhage. Would somebody get a bandage the size of Idaho?

Margins

6/2006

8/2006

11/2006

3/2007

5/2007

8/2007

Gross

22.5%

22.8%

24.5%

25.7%

21.9%

19.3%

Operating

2.4%

2.3%

3.5%

2.9%

(1.6%)

(4.7%)

Net

7.5%

7.7%

8.5%

3.8%

(1.7%)

(5.6%)

FCF/Revenue

20.5%

12.4%

(3.2%)

(29.4%)

(40.9%)

(46.9%)

Growth (YOY)

6/2006

8/2006

11/2006

3/2007

5/2007

8/2007

Revenue

7.2%

8.0%

9.2%

15.2%

9.1%

7.9%

All data courtesy of Capital IQ, a division of Standard & Poor's. Data reflects trailing-12-month performance for the quarters ended in the named months.

One Fool says:
Most memory manufacturers' stocks have lost 10% or more of their value this year, while camera sensor designer Omnivision has climbed 19%. You might expect Micron to do better than most of its peers, given the exposure to the sensor chip market, but only Spansion has fared any worse than Micron.

There was a short-lived rumor earlier this month that Samsung might buy some of Micron's operations, but the Korean giant firmly denied any such plans. The deal-fueled share price boost swiftly disappeared, and Micron hasn't been this cheap since March of 2003.

It will take much more than one positive quarter to bring Micron back to the halcyon days of 2006, when the stock traded in the upper teens. Deep-discount graveyard diggers might like to sniff around this business for awhile, since rigor mortis doesn't seem imminent. But it'll take patience and courage, because we might not have seen the bottom of the memory valley yet.

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Fool contributor Anders Bylund holds no position in any of the companies discussed here. You can check out Anders' holdings if you like, and Foolish disclosure is the Punxsutawney Phil of financial forecasting.