Prem Watsa, often called Canada’s Warren Buffett, has a knack for sensing when a stock has reached its potential and when another offers a chance to grow. His recent decision to sell Micron Technology (NASDAQ:MU) and pivot to Orla Mining (TSX:OLA) is a classic example of his investment strategy at work. Driven by the performance and potential of each company. So, let’s get into more on why Watsa made this move.
What happened?
Micron Technology, a titan in the semiconductor world, has had a wild ride. It had revenue growth of 93% year over year in its most recent quarter and a forward price-to-earnings (P/E) of just 11.56. Therefore, Micron appears undervalued at first glance. Its profit margins, however, are razor-thin at just 3.1%, and its return on equity is a small 1.74%.
Despite a strong recovery post-pandemic, including a market cap that ballooned to US$113 billion, Micron’s growth is largely tied to cyclical trends in…
