Research HubSoftware & Cloud ServicesMicron Technology, Inc. (MU)

Coverage:KVYO DDOG CRWD NOW SNOW PLTR ADBE CRM PANW NET SHOP MDB

SEC 10-K / 10-Q Equity ResearchSoftware & Cloud ServicesTicker: MU

Micron Technology, Inc. (MU) DCF Valuation & Fundamental Primer

Micron Technology, Inc. (MU) currently trades at $312.15 with an enterprise value of $162.75B. Our proprietary institutional model rates Micron Technology, Inc. at 86/100 (Grade: A · High-Quality Compounder). The current market price prices in an implied 5-year revenue CAGR of 41.1% vs. historical growth of 21.8% (Aggressive Growth Expectations Priced In).

GDA Quality Score

A86/100

High-Quality Compounder

Share Price / DCF Base

$312.15 / $169.12

Enterprise Value

$322.87B

TTM Revenue

$39.26B (+21.8%)

Gross Margin

79.3%

Rule of 40 Score

35.8%

EV / TTM Revenue

8.2×

Structural Moat: Enterprise Software & Cloud Services Switching Costs & Recurring Workflow Integration

Key Growth Catalyst: AI workflow automation, multi-module expansion across enterprise cohorts, and operating margin leverage at Micron Technology, Inc..

Institutional fundamental teardown of Micron Technology, Inc. (MU) covering SEC 10-K/10-Q cash flow conversion, SBC dilution friction, and Reverse-DCF valuation hurdles.

Seed MU in Interactive 3-Statement Model

Section 1 · Intrinsic Valuation Engine

Micron Technology, Inc. (MU) 3-Scenario DCF Valuation Range

WACC: 10.0% · Terminal Growth: 2.5% · Diluted Shares: 1119.5M

bear Case DCFSensitivity

$84.53

Implied Equity Value:$94.63B

vs Current ($312.15):-72.9%

base Case DCFPrimary Benchmark

$169.12

Implied Equity Value:$189.33B

vs Current ($312.15):-45.8%

bull Case DCFSensitivity

$289.19

Implied Equity Value:$323.76B

vs Current ($312.15):-7.3%

Interactive What-If DCF SandboxSim Rule of 40: 35.8%

Stress-test MU's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.

Seed Custom Drivers in /model

1-Click Regimes:

5Y Revenue CAGR21.8%

2%Hist: 21.8%50%

Target FCF Margin14.0%

5%Base: 14%45%

WACC Discount Rate10.0%

6.5%Base: 10%14.5%

Terminal Growth (g)2.5%

1.0%Implies 13.7× Y5 FCF4.0%

Accounting Lens:

Simulated Implied Price$169.12

Spread vs Market-45.8%

Simulated EV$162.75B

Effective FCF Margin14.0%

Simulated 5-Year Cash Flow Trajectory (Unlevered FCF vs. Discounted PV)Cumulative 5Y PV: $37.70B

Year 1$47.82B

FCF:$6.70B

PV:$6.09B

Year 2$58.25B

FCF:$8.16B

PV:$6.74B

Year 3$70.95B

FCF:$9.93B

PV:$7.46B

Year 4$86.42B

FCF:$12.10B

PV:$8.26B

Year 5$105.25B

FCF:$14.74B

PV:$9.15B

Enterprise Value Composition Bridge$162.75B

Split between 5-Year Explicit Cash Flows and Discounted Terminal Value

5Y Explicit PV: $37.70B (23.2%)Terminal PV: $125.04B (76.8%)

(+) Balance Sheet Cash & Equivalents+$26.58B

(−) Total Debt Obligations−$0

(=) Implied Equity Value (1119.5M shs)$189.33B

2D Institutional Valuation Sensitivity Heatmap

Implied share price & upside/downside spread across 25 valuation states (Current Price: $312.15).

WACC \ Terminal	1.5%	2.0%	2.5%	3.0%	3.5%
8.5%	$185.87 -40%	$196.31 -37%	$208.48 -33%	$222.87 -29%	$240.14 -23%
9.3%	$168.93 -46%	$177.15 -43%	$186.59 -40%	$197.55 -37%	$210.40 -33%
10.0%	$155.02 -50%	$161.63 -48%	$169.12 -46%	$177.68 -43%	$187.56 -40%
10.8%	$143.38 -54%	$148.79 -52%	$154.85 -50%	$161.69 -48%	$169.48 -46%
11.5%	$133.52 -57%	$138.00 -56%	$142.98 -54%	$148.55 -52%	$154.81 -50%

Section 2 · Fundamental Underwriting

Institutional Software Quality Scorecard (86/100 · Grade A)

High-Quality Compounder

Strong fundamentals, above-average cash generation, and robust competitive positioning.

Cash Conversion25 / 25

Actual: 467% of EBITTarget: Target: ≥100%

Elite deferred revenue float; FCF exceeds operating income by >20%

Dilution Friction16 / 25

Actual: 10.4% of RevTarget: Target: ≤8%

Standard software SBC dilution; modest equity transfer to employees

Unit Economics20 / 25

Actual: 79% GM / R40: 36%Target: Target: ≥75% GM / ≥40% R40

High-quality software margins with healthy balanced growth and profitability

Balance Sheet25 / 25

Actual: +$26.58B Net CashTarget: Target: Net Cash > 0

Zero-debt fortress balance sheet with abundant net cash liquidity

Core Investment Strengths & Moats

High-grade cash conversion: FCF is 467% of EBIT driven by upfront annual collections
Healthy unit economics: 79.3% gross margin
Fortress capital structure: Zero debt and $26.58B in pure net cash

Key Operational & Dilution Risks

Section 3 · Expectations Investing

Reverse-DCF Solver: What Growth is Priced Into MU?

Aggressive Growth Expectations Priced In

The current share price demands 41.1% 5-year CAGR (58.8% net of SBC & dilution)—a +19.3% acceleration over historical run-rate (21.8%). Any growth slowdown risks valuation multiple contraction.

Implied 5-Year Revenue CAGR

41.1%

Required to justify $322.87B EV

Historical Run-Rate CAGR

21.8%

Audited multi-year top-line trajectory

Growth Hurdle Spread

+19.3%

Implied hurdle minus historical growth

Implied FCF Margin @ Hist. Growth

27.8%

Steady-state FCF margin needed at current CAGR

Institutional Dilution-Adjusted Hurdle Lens

Headline Reverse-DCF ignores Stock-Based Compensation (10.4% of revenue) and annual share dilution (1.8%/yr). Accounting for both requires 58.8% 5-year revenue CAGR to justify $312.15/sh on a true per-share economic cash flow basis.

True Economic Hurdle58.8%

SBC & Dilution Hurdle Tax+17.7% / yr

Section 4 · 5-Year Forecast Schedule

Micron Technology, Inc. (MU) 5-Year Fundamental Forecast

Customize in Live Engine

Statement Line Item	TTM Audited Base	TTM	Y1	Y2	Y3	Y4	Y5
Revenue	$39.26B	$39.26B	$47.82B	$58.25B	$70.95B	$86.42B	$105.25B
Gross Profit	$31.14B	$31.14B	$37.92B	$46.19B	$56.26B	$68.53B	$83.47B
Operating Income (EBIT)	$1.18B	$1.18B	$1.43B	$1.75B	$2.13B	$2.59B	$3.16B
Stock-Based Compensation (SBC)	$4.08B	$4.08B	$4.97B	$6.06B	$7.38B	$8.99B	$10.95B
Unlevered Free Cash Flow (FCF)	$5.50B	$5.50B	$6.70B	$8.16B	$9.93B	$12.10B	$14.74B
SBC-Adjusted True Cash Flow	$1.41B	$1.41B	$1.72B	$2.10B	$2.55B	$3.11B	$3.79B

Section 5 · Relative Valuation Multiples & Regression

Software & Cloud Services Peer Comparables & Rule of 40 Regression

Click any peer node or ticker to open its dedicated equity research report

Rule of 40 vs. EV / Revenue Multiple Regression

OLS Fit: EV/Rev = -14.8 + 0.53 × (Rule of 40) · R² = 62%

Stocks below the gold regression line trade at a discount relative to their Rule of 40 compounding efficiency.

MU Actual vs. Reg. Multiple8.2× vs 4.2× fair

Reg.-Implied Share Price$171.29 (+95.4% Premium)

MUMicron Technology, Inc.·Rule of 40: 35.8%·Actual EV/Rev: 8.2×·Regression Fair Multiple: 4.2×

+95.4% Above Trendline (Premium)Open MU Report

Company	Ticker	Market Cap	TTM Revenue	Gross Margin	FCF Margin	Rule of 40	SBC % Rev	EV / Rev
Micron Technology, Inc.	MU	$349.46B	$39.26B	79.3%	14.0%	35.8%	10.4%	8.2×
ServiceNow	NOW	$152.61B	$10.98B	79.2%	31.1%	54.2%	15.9%	13.9×
Workday, Inc.	WDAY	$50.35B	$8.00B	75.0%	27.4%	43.9%	19.0%	6.4×
Salesforce	CRM	$217.10B	$37.90B	77.2%	32.8%	42.8%	8.4%	5.8×
Datadog	DDOG	$46.05B	$2.68B	80.8%	31.1%	57.7%	21.3%	17.4×
Snowflake Inc.	SNOW	$71.79B	$3.63B	66.5%	25.2%	57.7%	40.8%	20.0×
Hubspot	HUBS	$19.89B	$2.63B	85.0%	21.3%	52.7%	19.2%	7.7×
Peer Cohort Median Benchmark (N=6)				78.2%	29.2%	53.5%	19.1%	10.8×

Section 6 · Downside Protection & Multiple Sensitivity

EV / Revenue Multiple Compression Stress Test

Multiple Scenario	EV / Revenue	Implied Enterprise Value	Implied Equity Value	Implied Share Price	Delta vs Current
Current Multiple	8.2×	$322.87B	$349.46B	$312.15	0.0%
-20% Multiple Compression	6.6×	$258.30B	$284.88B	$254.47	-20.0%
-35% Multiple Compression	5.3×	$209.87B	$236.45B	$211.21	-35.0%
Software Baseline Floor (5.0× EV/Rev)	5.0×	$196.32B	$222.91B	$199.11	-39.2%

Section 7 · Investor Diligence FAQ

Frequently Asked Questions: Micron Technology, Inc. (MU) Valuation

What is Micron Technology, Inc. (MU)'s intrinsic DCF valuation and implied share price?

Based on audited SEC 10-K/10-Q filings and a 5-year 3-statement discounted cash flow (DCF) model, Micron Technology, Inc. (MU) has a Base Case implied value of $169.12 per share (with a Bear Case of $84.53 and a Bull Case of $289.19), compared to its current price of $312.15. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.

What is Micron Technology, Inc. (MU)'s Rule of 40 score and Free Cash Flow margin?

Micron Technology, Inc. achieves a Rule of 40 score of 35.8%, combining a 21.8% revenue growth run-rate with a 14.0% TTM free cash flow margin on $39.26B in trailing twelve-month revenue. In the Software & Cloud Services peer cohort, the median Rule of 40 benchmark is 53.5%.

What revenue growth rate is priced into MU stock according to Reverse-DCF analysis?

At $312.15 per share (Enterprise Value of $322.87B), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 41.1%, compared to Micron Technology, Inc.'s historical CAGR of 21.8%. Overall market expectations are rated as "Aggressive Growth Expectations Priced In".

How does Micron Technology, Inc. compare to Software & Cloud Services software peers?

Micron Technology, Inc. (MU) earns an institutional Software Quality Score of 86/100 (Grade A — High-Quality Compounder). Across its Software & Cloud Services peer group (NOW, WDAY, CRM, DDOG, SNOW), the cohort trades at a median EV/TTM Revenue multiple of 10.8× and a median gross margin of 78.2%.

How does Stock-Based Compensation (SBC) impact Micron Technology, Inc. (MU)'s valuation?

Micron Technology, Inc. recorded $4.08B in TTM stock-based compensation (10.4% of revenue). When treating SBC as a cash-equivalent compensation expense, Micron Technology, Inc.'s SBC-adjusted free cash flow yield is 0.4%, scoring 16/25 on our Shareholder Dilution Friction pillar.

Micron Technology, Inc. (MU) DCF Valuation & Fundamental Primer

WACC \ Terminal

1.5%

2.0%

2.5%

3.0%

3.5%

8.5%

$185.87

-40%

$196.31

-37%

$208.48

-33%

$222.87

-29%

$240.14

-23%

9.3%

$168.93

-46%

$177.15

-43%

$186.59

-40%

$197.55

-37%

$210.40

-33%

10.0%

$155.02

-50%

$161.63

-48%

$169.12

-46%

$177.68

-43%

$187.56

-40%

10.8%

$143.38

-54%

$148.79

-52%

$154.85

-50%

$161.69

-48%

$169.48

-46%

11.5%

$133.52

-57%

$138.00

-56%

$142.98

-54%

$148.55

-52%

$154.81

-50%

Statement Line Item

TTM Audited Base

TTM

Revenue

$39.26B

$47.82B

$58.25B

$70.95B

$86.42B

$105.25B

Gross Profit

$31.14B

$37.92B

$46.19B

$56.26B

$68.53B

$83.47B

Operating Income (EBIT)

$1.18B

$1.43B

$1.75B

$2.13B

$2.59B

$3.16B

Stock-Based Compensation (SBC)

$4.08B

$4.97B

$6.06B

$7.38B

$8.99B

$10.95B

Unlevered Free Cash Flow (FCF)

$5.50B

$6.70B

$8.16B

$9.93B

$12.10B

$14.74B

SBC-Adjusted True Cash Flow

$1.41B

$1.72B

$2.10B

$2.55B

$3.11B

$3.79B

Company

Ticker

Market Cap

TTM Revenue

Gross Margin

FCF Margin

Rule of 40

SBC % Rev

EV / Rev

Micron Technology, Inc.

$349.46B

$39.26B

79.3%

14.0%

35.8%

10.4%

8.2×

ServiceNow

NOW

$152.61B

$10.98B

79.2%

31.1%

54.2%

15.9%

13.9×

Workday, Inc.

WDAY

$50.35B

$8.00B

75.0%

27.4%

43.9%

19.0%

6.4×

Salesforce

CRM

$217.10B

$37.90B

77.2%

32.8%

42.8%

8.4%

5.8×

Datadog

DDOG

$46.05B

$2.68B

80.8%

31.1%

57.7%

21.3%

17.4×

Snowflake Inc.

SNOW

$71.79B

$3.63B

66.5%

25.2%

57.7%

40.8%

20.0×

Hubspot

HUBS

$19.89B

$2.63B

85.0%

21.3%

52.7%

19.2%

7.7×

Peer Cohort Median Benchmark (N=6)

78.2%

29.2%

53.5%

19.1%

10.8×

Multiple Scenario

EV / Revenue

Implied Enterprise Value

Implied Equity Value

Implied Share Price

Delta vs Current

Current Multiple

8.2×

$322.87B

$349.46B

$312.15

0.0%

-20% Multiple Compression

6.6×

$258.30B

$284.88B

$254.47

-20.0%

-35% Multiple Compression

5.3×

$209.87B

$236.45B

$211.21

-35.0%

Software Baseline Floor (5.0× EV/Rev)

5.0×

$196.32B

$222.91B

$199.11

-39.2%

Micron Technology, Inc. (MU) 3-Scenario DCF Valuation Range

2D Institutional Valuation Sensitivity Heatmap

Institutional Software Quality Scorecard (86/100 · Grade A)

Core Investment Strengths & Moats

Key Operational & Dilution Risks

Reverse-DCF Solver: What Growth is Priced Into MU?

Micron Technology, Inc. (MU) 5-Year Fundamental Forecast

Software & Cloud Services Peer Comparables & Rule of 40 Regression

Rule of 40 vs. EV / Revenue Multiple Regression

EV / Revenue Multiple Compression Stress Test

Frequently Asked Questions: Micron Technology, Inc. (MU) Valuation

What is Micron Technology, Inc. (MU)'s intrinsic DCF valuation and implied share price?

What is Micron Technology, Inc. (MU)'s Rule of 40 score and Free Cash Flow margin?

What revenue growth rate is priced into MU stock according to Reverse-DCF analysis?

How does Micron Technology, Inc. compare to Software & Cloud Services software peers?

How does Stock-Based Compensation (SBC) impact Micron Technology, Inc. (MU)'s valuation?

Related Software & Cloud Services Equity Research Reports

Micron Technology, Inc. (MU) 3-Scenario DCF Valuation Range

2D Institutional Valuation Sensitivity Heatmap

Institutional Software Quality Scorecard (86/100 · Grade A)

Core Investment Strengths & Moats

Key Operational & Dilution Risks

Reverse-DCF Solver: What Growth is Priced Into MU?

Micron Technology, Inc. (MU) 5-Year Fundamental Forecast

Software & Cloud Services Peer Comparables & Rule of 40 Regression

Rule of 40 vs. EV / Revenue Multiple Regression

EV / Revenue Multiple Compression Stress Test

Frequently Asked Questions: Micron Technology, Inc. (MU) Valuation

What is Micron Technology, Inc. (MU)'s intrinsic DCF valuation and implied share price?

What is Micron Technology, Inc. (MU)'s Rule of 40 score and Free Cash Flow margin?

What revenue growth rate is priced into MU stock according to Reverse-DCF analysis?

How does Micron Technology, Inc. compare to Software & Cloud Services software peers?

How does Stock-Based Compensation (SBC) impact Micron Technology, Inc. (MU)'s valuation?

Related Software & Cloud Services Equity Research Reports