Micron Technology Inc. ( MU ), a provider of dynamic random-access memory (DRAM) technologies, said fiscal first-quarter revenues increased 71% from the three months ending Dec. 1, 2016.
The Boise, Idaho-based company reported total revenues of $6.80 billion and net earnings of $2.19 per share, the former outperforming analyst estimates by approximately $0.41 billion.
Company earnings summary
Micron CEO Sanjay Mehrotra said double-digit sequential revenue growth across the company's business segments contributed to an 11% quarter-over-quarter revenue growth. The CEO added strong revenue growth reflects "increasing demand for [Micron's] mobile, server and SSD products." Figure 1 shows the company's revenue trend over the past 15 years.
Figure 1
Micron's expanding operating margins and gross margins primarily reflect expanding margins in the company's DRAM and NAND flash memory products. The company's gross margin increased 5.6% from the quarter ending August 2016 and approximately 19.60% per year over the past five years. Figure 2 shows the company's profit margin trends over the past five years.
Figure 2
"30-year financials" page illustrates three ways to analyze financial statements
Investopedia defines three types of financial statement analysis:
- "Common-size analysis" considers each income statement item as a percent of revenue. Examples of common-size analysis include operating margin, net margin and gross margin. For the balance sheet, common-size analysis considers each item as a percent of total assets.
- "Horizontal analysis" takes each income statement or balance sheet item and computes the year-over-year percent change for each item over the past several years.
- "Ratio analysis" considers common financial ratios like the current ratio, quick ratio, debt-to-equity ratio and the return on assets.
On a company's 30-year financials page, you can view the income statement numbers in one of four formats as illustrated in Figure 3. The gray "Income Statement" header contains four radio buttons labeled $, %, /share and % YOY.
Figure 3
Click on the "%" radio button to show the income statement values as a percentage of revenue. Likewise, clicking on the "% YOY" radio button displays the income statement values as year-over-year percentage changes. The former allows you to run common-size analysis while the latter allows you to run horizontal analysis. Figure 3.1 shows Micron's income statement with common-size analysis while Figure 3.2 shows the income statement with horizontal analysis.
Figure 3.1
Figure 3.2
You can run ratio analysis on a specific company by simply looking at the "Ratios" section of the 30-year financials page. Figure 4 shows a sample "Ratios" section for Micron.
Figure 4
Premium members can view and download 30 years of financial data for U.S. companies. The premium membership also includes access to the All-in-one Screener, the aggregated portfolio of gurus and various value screeners, including Warren Buffett (Trades, Portfolio)'s screen for good companies.
Disclosure: I do not have positions in the stocks mentioned.
This article first appeared on GuruFocus .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
