Micron plunges as Piper Sandler downgrades, cites 'oversized exposure' to consumer
Sundry Photography/iStock Editorial via Getty Images

Micron Technology (NASDAQ:MU) shares fell 8% on Friday as investment firm Piper Sandler downgraded the memory chip maker, citing its "oversized exposure" to consumer electronics.
Analyst Harsh Kumar lowered his rating on Micron (MU) shares to underweight from neutral and slashed his per-share price target to $70 from $90, noting the company's exposure to mobile, PCs and "other consumer end-markets" are subject to weaker trends, while the dynamic random access memory, or DRAM market, of which the company gets 70% of its revenue from, has started to see price declines. 
NAND pricing, which Micron (MU) also has exposure to, has seen a deceleration in the past few months, Kumar added.
"While we do feel the company has done an outstanding job to reduce its cost structure and remain financially disciplined, we continue to view memory as largely a commodity market compared to the rest of our universe," Kumar wrote in a note to clients.
"As a result, we do feel Micron is likely to underperform, and we prefer differentiated companies with less consumer exposure."
Kumar pointed out that Micron's (MU) exposure of greater than 50% to consumer markets is higher than many other semiconductor companies, and with some weakness in the mobile and PC markets, it's likely there could be "additional pressure on the company."
Micron (MU) is also not as exposed to the automotive market, which Kumar said events like rising rates, a slowing macro and the possibility of excess inventory may be a concern.
Currently, the analyst is only confident in Micron's (MU) data center business, which comprises less than 30% of its revenue.
On Thursday, it was reported that Taiwan Semiconductor (TSM) was looking to enhance its exposure to memory chip makers, including Micron Technology (MU).
Analysts have been overly bullish on Micron's stock (MU). It had an average rating of Strong Buy from Wall Street analysts, and a slightly less enthusiastic
BUY from Seeking Alpha authors. Conversely, Seeking Alpha's quant system, which consistently beats the market, rated Micron a STRONG BUY.