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Tom Essaye Break Down Micron’s Earnings Beat With Yahoo Finance

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The most important part of the Micron earnings were really their referencing these strategic customer agreements, Says Tom Essaye

‘We don’t view this as a bubble’ that will pop soon: Wall Street weighs surging AI costs on stock market rally

Yahoo Finance Senior Business Reporter Ines Ferre and Sevens Report Research Founder Tom Essaye break down Micron’s (MU) earnings beat and stronger-than-expected guidance. They discuss how record revenue and growing demand for AI memory chips may boost confidence in the broader AI trade.

You know, over the past couple days, you’ve sort of the market has gotten itself in sort of a negative feedback loop, right? Saying is this sustainable? Can the spending continue? Is there enough capital to continue to fund all this? And Micron came out and basically said, yes, yes, there is. And that’s turning sentiment around. The most important part of the Micron earnings were really their referencing these strategic customer agreements.

The whole key around the memory boom, much like inflation honestly, is it a flash in the pan or is it sustainable? Micron is growing earnings at like hundreds and hundreds of percent, but the stock only trades at a 10X forward multiple. The S&P 500 trades at a 20X forward multiple and isn’t growing earnings nearly as fast. The reason Micron and Nvidia are cheap is because investors are concerned that this earnings boom won’t last. If earnings, if investors believe it will last, which Micron’s earnings helped, you know, reinforce that idea, then this market has a lot more room to run.

Also, click here to view the full video published on Yahoo Finance on June 25th, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

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New ETFs to Watch (Recent Releases)

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What’s in Today’s Report:

  • New ETFs to Watch (Recent Releases)

Futures are moderately higher following blowout Micron earnings and a further decline in oil prices.

Micron (MU) earnings and guidance were much stronger than expected (stock up 17% pre-market) and that’s helping tech and the broader market to rebound.

Oil prices dropped another 1% overnight as insurance rates for Hormuz transit plunged.

Today focus will be on economic data and the key reports are, in order or importance:  Core PCE Price Index (E: 0.3% m/m, 3.4% y/y), Durable Goods (E: -4.7%) and Jobless Claims (E: 225K).  The best case scenario for stocks, which would further the early rally, would be better than expected Core PCE Price Index that eases inflation/rate hike concerns and solid Durable Goods and jobless claims (signaling still solid growth).

There are also two Fed speakers today, the most important of which is Williams (3:40 p.m. ET) and if he downplays rate hike chances, that would be another positive tailwind on markets.  Chicago Fed President Goolsbee also speaks but after the close (6:30 p.m. ET).

 

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We’re Not Seeing The Type of P/E Surge You’d Expect Says Sevens Report Analysts

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Notably, this is just what we saw with semiconductors starting three years ago, Sevens Report Analysts.

The ‘Insatiable’ Logic Behind Micron’s ‘Extreme’ Gains

“We’re not seeing the type of P/E surge you’d expect given the rallies, because earnings are rising faster than the share prices (notably, this is just what we saw with semiconductors starting three years ago),” wrote analysts at Sevens Report in a research note.

“While the gains have been extreme in the near term, the reality is they are being fueled by insatiable demand that likely won’t end unless the hyperscalers abandon the AI data center buildout (and that’s not likely to happen in the next 12-18 months),” wrote the Sevens Report analysts.

Also, click here to view the full article published in Barron’s on May 27th, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

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December Market Multiple Table – Deterioration Across Market Influences

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What’s in Today’s Report:

  • December Market Multiple Table – Deterioration Across Market Influences

Futures are seeing a solid rebound thanks to strong tech earnings and positive AI news.

Micron (MU) beat earnings estimates (stock up 11% pre-open) and, more importantly, gave robust guidance and that’s helping to reinforce AI Enthusiasm and lift tech and the entire market this morning.

Today will be a busy day of central bank decisions and economic data.  The most important economic report today is CPI (E: 0.3% m/m, 3.1% y/y), followed by Jobless Claims (E: 225K) and Philly Fed  (E: 2.2).  CPI needs to come in at or under expectations to push back on the hawkish Fed narrative and help support stocks.  Other economic data, meanwhile, needs to stay solidly positive to imply stable economic activity.

On the central bank front, we get a BOE Rate Decision (E: 25 bps cut) and ECB Rate Decision (E: No change) and as long as there are no hawkish surprises from either, they shouldn’t move markets.

Finally, on the earnings front, some reports we’re watching today include:  ACN ($3.74), KMX ($0.32), DRI ($2.09), NKE ($0.37), FDX ($4.05), KBH ($1.79).

 

Why Is the Fed Thinking About Cutting Rates?

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What’s in Today’s Report:

  • Why Is the Fed Thinking About Cutting Rates?

Futures are bouncing modestly following Wednesday afternoon’s drop thanks to solid earnings and merger news.

Micron (MU) posted strong earnings and guidance (stock up 5% pre-market). That’s helping to counter the negative earnings news from Wednesday.

Merger activity is also helping stocks bounce as Paramount (PARA) is said to be in talks to buy Warner (WBD). That news is also helping sentiment this morning.

Today focus will be on economic data and the two most important reports are Jobless Claims (E: 210K) and the Philadelphia Fed Manufacturing Survey (E: -3.0).  With the Fed having dovishly pivoted, data needs to be in-line with expectations. Otherwise, growth worries will rise and pressure stocks.  We also get the final Q3 GDP (E: 5.2%) but that’s very old data at this point and shouldn’t move markets.

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Is the Yield Curve Already Forecasting a Fed Rate Cut?

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What’s in Today’s Report:

  • Is the Yield Curve Already Forecasting a Fed Rate Cut?

Futures are slightly higher following a quiet night of news as investors digest Thursday’s declines and look ahead to the long weekend.

Economically the only notable report was Japanese CPI and it came in slightly lower than expectations at 3.7% y/y vs. (E) 3.8% y/y. but it didn’t move markets.

Today focus will be on economic data and the key reports are, in order of importance: Core PCE Price Index (E: 0.2% m/m, 4.6% y/y), University of Michigan Consumer Sentiment (E: 59.1), Durable Goods (E: -0.8%) and New Home Sales (E: 600k).   Markets will want to see further confirmation of dis-inflation in the Core PCE Price Index and the Five Year Inflation Expectations in the University of Michigan report, and if that happens it could spur a mild rally following yesterday’s declines.

Tom Essaye Quoted in Yahoo Finance on December 8, 2020

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Semiconductor giant Micron’s (MU) upbeat guidance last week for its most recent quarter was a buy signal on tech stocks, Sevens Report Research founder Tom Essaye says.

“Semiconductors have been on fire and not just from momentum…” Essaye explained. Click here to read to read the full article.