Lam Research (NASDAQ:LRCX) Shares Up 1.4% – What’s Next?

Shares of Lam Research Corporation (NASDAQ:LRCX) rose 1.4% during mid-day trading on Tuesday. The stock traded as high as $237.28 and last traded at $230.72. 10,117,133 shares changed hands during trading, a decline of 6% from the average session volume of 10,775,396 shares. The stock had previously closed at $227.56.

Lam Research News Roundup

Here are the key news stories impacting Lam Research this week:

• Positive Sentiment: The board approved a $25 billion share repurchase authorization, allowing Lam to buy back up to 9% of its outstanding shares, and declared a quarterly dividend of $0.33 per share. The buyback may support demand for the stock and signals management’s willingness to return capital. Company announcement
• Negative Sentiment: Reports attributed the selloff to investors reconsidering AI-related semiconductor-equipment spending and the sustainability of the sector’s recent profitability. That uncertainty may weigh on Lam, whose business depends on semiconductor manufacturers’ investment cycles. Article on semiconductor-equipment investors reassessing AI spending
• Negative Sentiment: Lam’s latest outlook also highlighted execution risks: management expects component shortages and a near-term decline in China-related revenue. The company forecast December-quarter revenue of about $8.6 billion and diluted EPS near $2.33, so investors may focus on whether supply and regional headwinds affect delivery of those targets. Article on Lam’s guidance
• Neutral Sentiment: One report said the stock’s sharp drop had no clear company-specific catalyst, suggesting broader market or sector positioning may also have contributed. Article on Lam Research’s share-price move

Analysts Set New Price Targets

Several brokerages recently weighed in on LRCX. UBS Group restated a “buy” rating and issued a $400.00 price target (down from $425.00) on shares of Lam Research in a research note on Thursday, October 22nd. TD Cowen reissued a “buy” rating and issued a $400.00 price objective (up from $340.00) on shares of Lam Research in a report on Thursday, July 9th. HSBC restated a “hold” rating and issued a $333.00 price objective on shares of Lam Research in a research report on Monday, July 27th. Citigroup reaffirmed a “buy” rating and set a $435.00 target price (down from $450.00) on shares of Lam Research in a research note on Thursday, October 22nd. Finally, Mizuho decreased their target price on Lam Research from $365.00 to $360.00 and set an “outperform” rating on the stock in a research report on Thursday, October 22nd. Twenty-six analysts have rated the stock with a Buy rating and six have assigned a Hold rating to the company’s stock. Based on data from MarketBeat.com, the company presently has a consensus rating of “Moderate Buy” and a consensus target price of $360.23.

Lam Research Price Performance

The company has a debt-to-equity ratio of 0.27, a quick ratio of 1.86 and a current ratio of 2.48. The stock has a market capitalization of $231.61 billion, a PE ratio of 32.76, a price-to-earnings-growth ratio of 0.82 and a beta of 1.97. The stock’s 50 day moving average is $286.73 and its two-hundred day moving average is $283.78.

Lam Research (NASDAQ:LRCX) last posted its quarterly earnings data on Wednesday, October 21st. The semiconductor company reported $2.20 EPS for the quarter, topping the consensus estimate of $2.18 by $0.02. Lam Research had a return on equity of 72.15% and a net margin of 32.34%. The company had revenue of $8.22 billion during the quarter, compared to analyst estimates of $8.14 billion. During the same period in the previous year, the business earned $1.26 EPS. Lam Research’s quarterly revenue was up 54.4% on a year-over-year basis. On average, equities analysts anticipate that Lam Research Corporation will post 9.59 EPS for the current fiscal year.

Lam Research Increases Dividend

The firm also recently announced a quarterly dividend, which was paid on Wednesday, October 14th. Shareholders of record on Wednesday, September 23rd were paid a dividend of $0.33 per share. This is a boost from Lam Research’s previous quarterly dividend of $0.26. The ex-dividend date of this dividend was Wednesday, September 23rd. This represents a $1.32 annualized dividend and a yield of 0.7%. Lam Research’s dividend payout ratio is presently 19.67%.

Lam Research announced that its board has initiated a share buyback program on Thursday, November 5th that allows the company to repurchase $25 billion in outstanding shares. This buyback authorization allows the semiconductor company to repurchase up to 9% of its shares through open market purchases. Share buyback programs are typically a sign that the company’s management believes its shares are undervalued.

Insider Activity

In other Lam Research news, Director Bethany Mayer sold 9,557 shares of the stock in a transaction dated Wednesday, September 9th. The shares were sold at an average price of $314.74, for a total value of $3,007,970.18. Following the completion of the sale, the director owned 20,995 shares in the company, valued at approximately $6,607,966.30. This represents a 31.28% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, insider Ava Harter sold 5,000 shares of the firm’s stock in a transaction that occurred on Monday, August 31st. The stock was sold at an average price of $302.46, for a total transaction of $1,512,300.00. Following the completion of the transaction, the insider directly owned 42,462 shares in the company, valued at $12,843,056.52. This trade represents a 10.53% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Company insiders own 0.31% of the company’s stock.

Institutional Investors Weigh In On Lam Research

A number of large investors have recently made changes to their positions in LRCX. William Mack & Associates Inc. bought a new position in Lam Research during the 3rd quarter valued at $25,000. Cedar Mountain Advisors LLC increased its position in shares of Lam Research by 242.9% during the 1st quarter. Cedar Mountain Advisors LLC now owns 120 shares of the semiconductor company’s stock valued at $26,000 after purchasing an additional 85 shares during the period. Paladin Partners LLC acquired a new position in shares of Lam Research during the 2nd quarter valued at $26,000. Quintet Private Bank Europe S.A. raised its stake in shares of Lam Research by 100.0% in the 3rd quarter. Quintet Private Bank Europe S.A. now owns 100 shares of the semiconductor company’s stock worth $33,000 after buying an additional 50 shares in the last quarter. Finally, Dakota Community Bank & Trust NA bought a new stake in shares of Lam Research in the 3rd quarter worth $33,000. 84.61% of the stock is currently owned by hedge funds and other institutional investors.

Lam Research Company Profile

Lam Research Corporation (NASDAQ:LRCX) is a semiconductor equipment company that develops and manufactures systems used to fabricate integrated circuits. Its technologies support key stages of wafer processing, helping semiconductor manufacturers create the increasingly complex structures found in memory, logic and other types of chips.

The company’s product portfolio includes etch systems, which selectively remove materials from wafers; deposition systems, which apply thin films; and cleaning solutions used to remove contaminants and residue during manufacturing.