12 Best Large Cap Stocks To Buy Now

2. Micron Technology Inc. (NASDAQ:MU)

Market Capitalization as of September 13: $100.41 billion

Number of Hedge Fund Holders: 120

Micron Technology Inc. (NASDAQ:MU) produces computer memory and computer data storage including dynamic random-access memory, flash memory, and USB flash drives. Its products are used in a range of devices, including smartphones, tablets, laptops, and servers. It is a major player in the memory market and is known for its technological advancements.

In the fiscal third quarter of 2024, the company generated revenue of $6.8 billion, versus the $3.7 billion figure from the same period a year ago, jumping by ~82% in a year. There’s robust AI demand, which is the primary factor for this revenue growth. Despite a strong FQ3 2024, the company may be struggling due to an inventory glut from last year, which is also why last year’s financials are significantly lower than this year’s.

The company is heavily investing in high bandwidth memory production that is expected to generate billions in sales by fiscal 2025 compared with just hundreds of millions in 2024.

Micron Technology Inc. (NASDAQ:MU) is well-positioned to benefit from favorable industry trends in the smartphone, personal computer, and data center sectors. That’s why 120 hedge funds hold stakes in the company as of June 30. The largest position is at $928.5 million by Citadel Investment Group.

Investors recognize that Micron’s current struggles stem from its significant capital expenditures aimed at expanding manufacturing capacity. In FQ3, the company invested $2.06 billion in capital expenditures. However, the company sees that these investments are expected to drive growth in the future, especially as it is making these investments at a strategic time with support from the US government to enhance its domestic semiconductor manufacturing capabilities.

Fueled by strong AI demand, the company is well-equipped to benefit from the rebound in memory prices and favorable inventory balances, making it a compelling large-cap stock to buy now.

ClearBridge Value Equity Strategy stated the following regarding Micron Technology, Inc. (NASDAQ:MU) in its Q2 2024 investor letter:

“Stock selection in the IT sector proved to be the largest contributor to performance, particularly driven by the strong performance of Micron Technology, Inc. (NASDAQ:MU) The company, which designs, develops, manufactures and sells memory and storage products, continued its strong performance alongside other AI beneficiaries as the anticipated demand for new and additional storage essential for housing and training large language AI models continues to grow.”