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Micron Tech, a Bull in Bear's Clothes

|Includes: Micron Technology Inc. (MU)

We have seen a rough stretch of days for the tech sector recently.  The disaster in Japan has left many stocks short on supply and many investors wondering what material implications could be in store.  However rather than worrying about the negatives in front of us, maybe it's time to think of the positive effects of the supply crunch.

One story that has been making headlines is the expected decline in Apple's iPad 2 supply.  Many of the suppliers for the ipad 2 were damaged during the earthquake and subsequent tsunami in Japan.  While this is very negative for some (Toshiba, mitsubishi, sony, etc.), it's a great opportunity for others.  Toshiba, who's expecting to see production losses, is responsible for supplying Apple with the memory chips for the iPad 2.  However these chips are part of the highly populated semiconductor industry, and are easily replaceable.  Therefore Apple can easily replace their memory chip supplier with another company, like Micron Tech (NASDAQ:MU), who has no involvement with Japan.

Micron Tech is a manufacturer of DRAM and NAND memory chips, just the type used in the majority of smartphones and tablets.  However unlike most other semiconductor manufacturers, Micron Tech is located in the United States, and completely removed from the tragedies of Japan.  Micron Tech had a recent run up to $11.95 just last month, and with an expected increase in demand, I wouldn't be surprised if we see that price again.  Right now Micron trades at almost $10 a share which is roughly 15% off from the 52 week high of $11.95, and very attractive.  Recently Micron Tech has been pulled down by the overwhelmingly negative sentiment towards the tech sector.  However there is nothing fundamentally wrong with Micron Tech, it's just another victim of the recently bearish tech sector.  As the supply squeeze becomes more apparent look for stocks like Micron Tech (MU) to really benefit.

Disclosure: I am long MU.