It’s been quite the roller coaster for Micron Technology, Inc. (NASDAQ:MU) stock of late. A long bull run driven by strengthening pricing in DRAM and NAND sent the stock above $60 for the first time in 18 years back in March. Within weeks, MU stock was near $45.

A quick rally followed to a new multiyear high, only for more choppiness to follow the past few sessions. An analyst downgrade, concerns about a regulatory investigation in China, and continuing pricing concerns all have added to the volatility in Micron stock.

I’d expect that volatility to continue for the foreseeable future. Micron is one of the most cyclical stocks in the market, and clearly, some investors are getting nervous. A sub-6x forward P/E multiple seems ridiculous in the context of recent growth, but given the huge swings in pricing, and profits, Micron has seen in the past, it makes some sense.

Micron should look cheap on an earnings basis, particularly at this point in the cycle. But that aside, MU stock still is too cheap, as I’ve argued several times in the past. The question for bullish investors is whether they want to ride out the volatility — or try to take advantage of it.

Bad News Follows Good News

The new late May high near $65 for MU stock appeared well deserved. The stock had slumped coming out of fiscal Q2 earnings in March, despite a solid beat and strong guidance for Q3.

As the calendar turned to May, however, pricing in both NAND and DRAM appeared strong. Analysts got behind the stock, with RBC Capital projecting nearly 50% upside. And as I wrote last month, the company’s Analyst Day provided more good news, notably with even better guidance for Q3 and a $10-billion share repurchase authorization.

But a week later, Morgan Stanley (NYSE:MS) would downgrade MU stock, sending it tumbling. The cut was largely a valuation call, as James Brumley pointed out, but analyst Joseph Moore also raised concerns about pricing and demand. Two days later, reports of a Chinese investigation into DRAM price-fixing added more pressure.

And so the tug-of-war over MU stock continues. Bulls tend to look at current results and the seemingly insanely low valuation. Bears are looking for the inevitable crash around the corner. Micron stock seems stuck in the middle.

Stick With MU Stock

For now, Micron stock seems worth hanging on to. Again, the stock isn’t as cheap as earnings multiples suggest. Cyclical concerns are real. The Chinese investigation could lead to lower DRAM prices in that market.

Micron, Samsung Electronics Co Ltd (OTCMKTS:SSNLF) and SK Hynix could make voluntary concessions along the way. NAND maker Western Digital Corp (NASDAQ:WDC) has instituted a buyback of its own, though WDC’s recent weakness could portend trouble for Micron in that offering.

Still, demand looks solid across the chip space. Advanced Micro Devices, Inc. (NASDAQ:AMD), Nvidia Corporation (NASDAQ:NVDA) and even Intel Corporation (NASDAQ:INTC) all continue to rally. In memory, demand should stay strong, particularly given an increasing diversification away from the flat or declining PC business.

And again, MU stock is cheap. The current earnings multiple already incorporates some level of pricing weakness going forward. It’s not as if the stock is trading at 15x earnings, and bears are arguing that profits are going to decline. Most bulls, too, accept that the cycle will turn at some point. The argument comes down to when, and how big that turn proves to be.

Profiting From Volatility

Meanwhile, some of the volatility could offer a better entry point for investors to build or add to their positions in MU. Chris Tyler detailed a bullish option spread on the stock last week. And investors — particularly those with big gains — can use options to protect their capital.

Indeed, far out-of-the-money puts still look rather cheap. The Jan 2019 $30 put, for instance, is offered at just $0.13.

That’s a premium of less than a quarter of a percentage point of the current price, offering protection against what admittedly would be a nearly unprecedented crash in MU stock. But note that MU did fall more than 50% in the first seven months of 2015. When the cycle turns in memory, it can turn violently.

All told, a straight bet on Micron stock still looks profitable. But the caution I advised back in March is worth having again at these levels. Long term, MU stock still has upside. In the near term, the road may be bumpy indeed.

As of this writing, Vince Martin has no positions in any securities mentioned.