MKM: 'Room To Disappoint' For Micron Technology's Q3

Despite drastically lowered expectations, Micron Technology, Inc. (NASDAQ: MU) still has room to disappoint Wall Street when it posts quarterly results Thursday, an analyst said.

MKM's Ian Ing cut his target on Micron 9 percent Tuesday to $30, citing continued weakness in demand for personal computers and an oversupply of related semiconductors in Chinese warehouses.

Wall Street analysts on average have trimmed their estimates for Micron's fiscal third quarter by more than 42 percent during the past three months.

The consensus currently calls for Micron to post adjusted earnings of $0.57 a share on revenue contraction of about 1.7 percent to $3.91 billion for its fiscal third quarter ended May 15.

Although Micron has beaten expectations in each of the past four quarters, Ing said its struggles in the PC market "could be prolonged."

Ing trimmed his third quarter earnings estimate 16 percent to $0.55 a share, maintaining a Neutral rating on the company.

A bright spot for Micron may be the market for mobile memory chips, which Ing said account for roughly a quarter of the company's sales.

"It could eventually fill the PC revenue hole," according to Ing, who noted that oversupply of mobile memory chips is now "in the rear view mirror."

Micron shares, off nearly 30 percent year-to-date, traded recently at 24.58, down $0.06.