Feb. 27 (Bloomberg) -- Micron Technology Inc., the largest U.S. maker of computer-memory chips, rose the most in two months after Japan-based rival Elpida Memory Inc. filed for bankruptcy.
Micron advanced 7.7 percent to $8.56 at the close in New York, for the biggest one-day percentage increase since Dec. 22.
Elpida, the last Japanese maker of dynamic random access memory, or DRAM, chips, filed for bankruptcy after semiconductor prices plunged and it failed to win a second government bailout. While there’s too much capacity in the DRAM market, Micron could acquire some of Elpida’s facilities and convert them to produce Nand flash, the chips used in mobile phones and tablets, Kevin Cassidy, a Stifel Nicolaus & Co. analyst, said.
“The biggest thing it does is signal to the market that prices need to come up for DRAM,” Cassidy, a New York-based analyst, said of Elpida’s bankruptcy filing. “PC manufacturers have been benefiting from the DRAM industry selling below its cost,” said Cassidy, who recommends buying Micron shares.
While Boise, Idaho-based Micron doesn’t need to acquire any of Elpida’s assets, Nand flash presents a “higher growth” opportunity, he said in a telephone interview today.
Dan Francisco, a Micron spokesman, said the company doesn’t comment on market rumors.
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