KLA (NASDAQ:KLAC) Shares Gap Up – What’s Next?

KLA Corporation (NASDAQ:KLAC)’s stock price gapped up before the market opened on Thursday . The stock had previously closed at $221.18, but opened at $239.02. KLA shares last traded at $244.7060, with a volume of 2,361,454 shares changing hands.

Analyst Ratings Changes

A number of brokerages recently issued reports on KLAC. Oppenheimer reiterated an “outperform” rating and issued a $200.00 price target on shares of KLA in a research note on Thursday, April 30th. Citic Securities raised their price objective on shares of KLA from $135.00 to $197.00 in a research note on Wednesday, May 6th. Citigroup reaffirmed a “buy” rating on shares of KLA in a report on Wednesday, June 17th. Rothschild & Co Redburn increased their price target on shares of KLA from $140.00 to $186.50 and gave the company a “neutral” rating in a report on Tuesday, May 12th. Finally, Zacks Research downgraded shares of KLA from a “strong-buy” rating to a “hold” rating in a research report on Monday, March 16th. Twenty research analysts have rated the stock with a Buy rating and ten have issued a Hold rating to the stock. According to data from MarketBeat, the company has a consensus rating of “Moderate Buy” and a consensus price target of $280.34.

KLA Price Performance

The stock has a market capitalization of $307.77 billion, a PE ratio of 66.61, a PEG ratio of 2.38 and a beta of 1.41. The firm’s fifty day moving average price is $214.09 and its two-hundred day moving average price is $172.21. The company has a quick ratio of 2.11, a current ratio of 3.03 and a debt-to-equity ratio of 1.01.

KLA (NASDAQ:KLAC) last posted its earnings results on Wednesday, April 29th. The semiconductor company reported $9.40 EPS for the quarter, topping analysts’ consensus estimates of $0.92 by $8.48. The business had revenue of $3.42 billion during the quarter, compared to the consensus estimate of $3.37 billion. KLA had a net margin of 35.66% and a return on equity of 91.89%. The firm’s revenue was up 11.5% on a year-over-year basis. During the same quarter in the previous year, the firm posted $0.84 EPS. KLA has set its Q4 2026 guidance at 8.870-10.870 EPS. On average, equities analysts predict that KLA Corporation will post 3.71 earnings per share for the current year.

KLA Cuts Dividend

The company also recently announced a quarterly dividend, which was paid on Tuesday, June 2nd. Shareholders of record on Monday, May 18th were issued a $0.23 dividend. The ex-dividend date of this dividend was Monday, May 18th. This represents a $0.92 dividend on an annualized basis and a yield of 0.4%. KLA’s dividend payout ratio is currently 26.06%.

KLA declared that its Board of Directors has initiated a stock repurchase program on Thursday, March 12th that permits the company to repurchase $7.00 billion in outstanding shares. This repurchase authorization permits the semiconductor company to repurchase up to 3.6% of its shares through open market purchases. Shares repurchase programs are usually a sign that the company’s board believes its stock is undervalued.

Insider Activity

In other news, CFO Bren D. Higgins sold 27,701 shares of the stock in a transaction that occurred on Thursday, July 2nd. The shares were sold at an average price of $265.69, for a total value of $7,359,878.69. Following the transaction, the chief financial officer owned 263,472 shares in the company, valued at $70,001,875.68. This represents a 9.51% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, EVP Mary Beth Wilkinson sold 14,392 shares of the firm’s stock in a transaction that occurred on Wednesday, July 1st. The stock was sold at an average price of $285.30, for a total transaction of $4,106,037.60. Following the completion of the transaction, the executive vice president directly owned 53,367 shares in the company, valued at approximately $15,225,605.10. The trade was a 21.24% decrease in their position. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold 132,333 shares of company stock valued at $29,547,170 in the last quarter. 91.48% of the stock is currently owned by insiders.

Institutional Inflows and Outflows

Several institutional investors have recently added to or reduced their stakes in the business. Basepoint Wealth LLC purchased a new position in shares of KLA during the 4th quarter worth $32,000. Triumph Capital Management purchased a new stake in shares of KLA in the 3rd quarter worth $40,000. Hilton Head Capital Partners LLC bought a new position in KLA in the 4th quarter worth $41,000. Aventura Private Wealth LLC bought a new position in KLA in the 4th quarter worth $55,000. Finally, Nemes Rush Group LLC lifted its position in KLA by 17.1% during the fourth quarter. Nemes Rush Group LLC now owns 48 shares of the semiconductor company’s stock valued at $58,000 after purchasing an additional 7 shares in the last quarter. 86.65% of the stock is currently owned by institutional investors.

About KLA

KLA is a provider of process control and yield management solutions for the semiconductor and related microelectronics industries. The company designs and manufactures equipment, software and services used by chipmakers to analyze and control manufacturing processes, detect defects, measure critical dimensions and improve yield across wafer fabrication, photomask and packaging operations. KLA’s offerings are aimed at enabling production of advanced logic, memory, and specialty devices at progressively smaller technology nodes and more complex package structures.

Its product portfolio includes optical and e-beam inspection systems, metrology tools for critical dimension and film measurement, mask and reticle inspection platforms, as well as enterprise software and data analytics that aggregate process data and drive automated process control.