Lam Research (LRCX) Dips More Than Broader Markets: What You Should Know
Lam Research (LRCX) closed at $712 in the latest trading session, marking a -1.86% move from the prior day. This change lagged the S&P 500's 0.06% loss on the day. Elsewhere, the Dow gained 0.59%, while the tech-heavy Nasdaq lost 0.3%.
Heading into today, shares of the semiconductor equipment maker had gained 8.67% over the past month, outpacing the Computer and Technology sector's gain of 4.06% and the S&P 500's gain of 5.76% in that time.
Investors will be hoping for strength from Lam Research as it approaches its next earnings release. In that report, analysts expect Lam Research to post earnings of $8.46 per share. This would mark year-over-year growth of 40.3%. Our most recent consensus estimate is calling for quarterly revenue of $4.4 billion, up 27.38% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $34.29 per share and revenue of $17.76 billion. These totals would mark changes of +25.88% and +21.44%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for Lam Research. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Lam Research is currently sporting a Zacks Rank of #2 (Buy).
In terms of valuation, Lam Research is currently trading at a Forward P/E ratio of 21.16. Its industry sports an average Forward P/E of 20.42, so we one might conclude that Lam Research is trading at a premium comparatively.
Investors should also note that LRCX has a PEG ratio of 1.24 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Semiconductor Equipment - Wafer Fabrication stocks are, on average, holding a PEG ratio of 1.24 based on yesterday's closing prices.
The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 65, which puts it in the top 26% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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