We recently published a list of 7 Cheap Global Stocks to Buy Right Now. In this article, we are going to take a look at where Micron Technology, Inc. (NASDAQ:MU) stands against other cheap global stocks to buy right now.
The geopolitical landscape has drastically changed since the beginning of the decade, with the COVID-19 pandemic followed by worldwide spikes in inflation leading to completely different economic tendencies if compared to the previous decade. The conflict in Ukraine brought even more geopolitical turmoil, with many analysts believing that this war represents the end of several political and economic alliances, notably between Europe and Russia on the one hand, and between the USA and China on the other hand. The first so-called alliance of the past led to strong economic growth in both the EU and Russia, as the former used cheap energy and commodities from Russia to fuel its industrial sector (particularly that of Germany), while Russia itself had the freedom to export its capital and source the technology and talent it needed for development. The second so-called alliance, between the USA and China, fueled unprecedented growth in China, in a journey to secure the American market and industry with cheap electronics, components, consumer products, and everything the country needed to grow its technological leadership.
ALSO READ: 10 Cheap New Stocks To Buy Right Now
As the Ukraine conflict unfolded in Eastern Europe, some tendencies from the times of the Cold War proliferated again, with the East and the West isolating each other, as the USA and Europe aligned to support Ukraine, while China had the back of Russia. The aforementioned “old” alliances were shattered, and each region started to face new problems – the EU’s energy security faced unprecedented risks, with energy prices skyrocketing across central and eastern Europe, leading to a slowdown in economic growth and tremendous pressure on the regular consumer. The US and China escalated the trade wars that had their roots in the previous decade – in an attempt to protect its technological leadership, particularly in the AI field, the US imposed restrictions to export semiconductor equipment used in the production of state-of-the-art chips, such as powerful GPUs to train AI models. China imposed some retaliatory restrictions regarding several strategic commodities sourced by the US. Even though the trade wars are still not fully enforced by both parties, the tensions persist and have deep implications for the financial markets and the global economy.
As geographic markets became more disconnected, the stock markets in the USA, Europe, and APAC had quite different performances, with the former leading by a wide margin in 2023-2024. For reference, the 5-year performance of the German stock market lagged that of the US by 57%, China lagged the US by 94%, and Japan lagged the US by 58%. In light of the proliferating geopolitical challenges, which still persist as the new Trump 2.0 administration threatens tariffs on its supposed allies as well as China again, we believe that global companies that are diversified across geographies will be the most favored in the years to come, due to stronger potential to diversify idiosyncratic risk. Furthermore, as the US stock market is currently near all-time highs after a stellar 2023-2024 period, cheap companies trading under 15.0x forward P/E might be the only viable option to buy in the current expensive market. Successful investors like Warren Buffet acknowledged that an overstretched valuation could hinder the subsequent performance of a stock. Here’s precisely what he said during his 1998 letter to shareholders:
“For the investor, a too-high purchase price for the stock of an excellent company can undo the effects of a subsequent decade of favorable business developments.”
Our Methodology
We used a Finviz screener to filter the largest stocks trading at under 15x forward P/E and analyzed the companies’ filings in order to identify 7 promising global companies that generated at least 40% of revenue in the last financial year from outside the US. For each company, we also include the number of hedge funds that own the company as of Q4 2024 and rank them in ascending order.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A close-up view of a computer motherboard with integrated semiconductor chips.
Micron Technology, Inc. (NASDAQ:MU)
Forward P/E ratio as of February 24th: 8.72x
Number of Hedge Fund Holders: 94
Micron Technology, Inc. (NASDAQ:MU) is a key player in the semiconductor industry, specializing in memory and storage solutions that power everything from data centers to consumer electronics. As one of the world’s largest suppliers of DRAM and NAND flash memory, MU benefits from growing demand for high-performance computing, AI, and cloud infrastructure. The company operates in a highly cyclical market, where pricing dynamics and supply chain shifts can impact margins. The US-based company ranked 7th on our recent list of 10 Hot AI Stocks to Buy Now.
Micron Technology, Inc. (NASDAQ:MU) issued optimistic guidance for the following months as it expects revenue growth in the fiscal 3Q, though gross margins are projected to be lower by a few hundred basis points sequentially due to higher consumer-oriented mix and weaker NAND conditions. The company anticipates improvements in client and smartphone inventory levels, expecting them to reach healthy levels by spring, along with continued content growth in PC and smartphone segments through calendar 2025. In the High Bandwidth Memory segment, MU is progressing well with its 12-high stack product, which offers 20% less power than competitors’ 8-high stack while providing 50% more capacity. The company maintains a strong position in data center demand for DRAM, though its data center eSSD segment is experiencing a temporary digestion period.
Looking ahead, management expects industry conditions to support improved margins beyond fiscal Q3, with positive indicators including stronger bit shipments and improving inventory levels. Micron Technology, Inc. (NASDAQ:MU) is seeing a significant content uplift in AI-related devices, with smartphone content increasing by over 50% for AI-related devices and PC refresh cycles showing 16 gigabyte minimums. In the NAND market, while current conditions remain challenging, MU anticipates better market conditions in the second half of the calendar year, supported by improving inventory levels and industry supply responses. At the same time, MU trades at a cheap 8.72x forward P/E, which is near the bottom of the last twelve months’ range. It is among the best cheap global stocks to invest in.
Overall, MU ranks 3rd on our list of cheap global stocks to buy right now. While we acknowledge the potential of MU as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than MU but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
