Micron Technology, Inc. (NASDAQ:MU) posted earnings results that were close to what Wall Street was expecting, but its shares slumped as management’s outlook was far below expectations. At least one firm trimmed its price target for the company’s stock, while others see room for upside to $15 or even $18 per share.

Micron Technology, Inc. Slumps On Earnings, Analyst Views Mixed

Goldman Sachs cuts price target for Micron

In a report dated July 1, Goldman Sachs analyst Mark Delaney said he cut his price target for Micron Technology from $13 to $12 per share and maintained his Neutral rating. For its third quarter of fiscal 2016, the company posted $2.9 billion in sales and non-GAAP losses of 8 cents per share. Analysts had been expecting $2.96 billion in revenue and losses of 9 cents per share. DRAM sales grew 9% sequentially, while NAND sales slipped 15%.

Delaney noted that this was the seventh quarter in a row in which Micron’s guidance for the next quarter was lower than what Wall Street was expecting. The company guided for losses of between 16 cents and 24 cents per share, although analysts had been expecting earnings of 3 cents per share. Delaney attributed this shortfall to lower DRAM average selling prices, lower cost downs for NAND, lower NAND bits and interest expenses.

He added that every time Micron’s guidance has disappointed, other analysts advise investors “to buy the last cut.” However, he believes the company will need to improve execution in order to see “meaningful profitability.”

Still upside to Micron

JPMorgan analyst Harlan Sur and team are among those who remain bullish on the memory maker. They still see room for Micron shares to climb to $15 per share despite the disappointing guidance. They said although the company’s financials aren’t “positively inflecting” in the August quarter as they had expected, improving fundamentals in the industry “should be enough to support the stock” in the wait to better financial performance in fiscal 2017.

They actually believe the company is executing on its transitions and product qualifications, resulting in “significant” growth in DRAM bits. They expect cost reductions and 3D NAND bit growth to inflect in the first quarter of fiscal 2017. JPMorgan has an Overweight rating and $15 price target on Micron shares.

Micron Technology moving forward

Morgan Stanley analyst Joseph Moore and team are also among the analysts who think Micron is successfully righting the ship. They suggest that investors “stay the course” with the company because they see the weak fourth quarter guide as mostly reflecting “backward looking issues.” They said most of the weakness management guided for in the August quarter is their forecast for worse DRAM prices.

However, they said manufacturing appears to be improving as yields “are clearly inflecting very nicely.” They also said that weakness in pricing shouldn’t continue to be a concern if the commodity environment continues to improve. Overall, they believe the DRAM market and execution have both turned a corner and see upside for Micron shares to $18 in the next 12 months. They continue to rate the stock at Overweight.

Shares of Micron Technology slumped by as much as 10.28% to $12.35 during regular trading hours on Friday.