Mohnish Pabrai’s 5 Biggest Investments in 10 Years

2. Micron Technology, Inc. (NASDAQ:MU)

Value of Pabrai Investment Funds’ 13F Position: $170 million (Q4 2021)

Stock Performance Since Q4 2021: -26.7%

Number of Hedge Fund Shareholders (Q1 2023): 73

Mohnish Pabrai sold off his stake in Micron Technology, Inc. (NASDAQ:MU) during the second quarter of this year following 13 straight quarters of the company ranking as his top stock pick. Micron has delivered underwhelming returns since Pabrai’s stake in the company peaked during the final quarter of 2021, with the stock losing 26.7% of its value since.

Micron Technology, Inc. (NASDAQ:MU) has been stung by slowing demand and falling prices for its memory chips as PC and smartphone sales have declined. In its Q3 of FY 2023, revenue sank by 57% to $3.75 billion, leading to a loss of $1.43 per share. The longer-term outlook looks more promising for the company however, particularly as it relates to the AI memory market. Micron is already a leader in the space and is currently working on a new HBM solution that could lay waste to the competition.

LRT Capital Management was surprised by the market reaction to Micron Technology, Inc. (NASDAQ:MU)’s September 2022 guidance update, as it discussed in its Q3 2022 investor letter:

“Anecdotally, stocks are beginning to react positively to what is prima facie bad news. For example, Micron Technology, Inc. (NASDAQ:MU), the maker of memory chips reported earnings and provided updated guidance on September 29^th. The guidance was well below what the company said previously and suggested the company may not make any money at all in Q1 next year. Yet, the stock went up, on the news, suggesting investors have priced in a lot of bad news already.