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Lam Research (LRCX) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research
·3 min read

In the latest trading session, Lam Research (LRCX) closed at $493.33, marking a -0.4% move from the previous day. This change lagged the S&P 500's 0.18% gain on the day. At the same time, the Dow lost 0.15%, and the tech-heavy Nasdaq gained 0.5%.

Coming into today, shares of the semiconductor equipment maker had gained 14.68% in the past month. In that same time, the Computer and Technology sector gained 5.57%, while the S&P 500 gained 3.22%.

LRCX will be looking to display strength as it nears its next earnings release. On that day, LRCX is projected to report earnings of $5.62 per share, which would represent year-over-year growth of 40.15%. Our most recent consensus estimate is calling for quarterly revenue of $3.31 billion, up 28.05% from the year-ago period.

LRCX's full-year Zacks Consensus Estimates are calling for earnings of $22.31 per share and revenue of $13.01 billion. These results would represent year-over-year changes of +39.87% and +29.53%, respectively.

Investors should also note any recent changes to analyst estimates for LRCX. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Within the past 30 days, our consensus EPS projection remained stagnant. LRCX currently has a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that LRCX has a Forward P/E ratio of 22.2 right now. For comparison, its industry has an average Forward P/E of 20.95, which means LRCX is trading at a premium to the group.

Meanwhile, LRCX's PEG ratio is currently 1.35. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. LRCX's industry had an average PEG ratio of 1.81 as of yesterday's close.

The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 41, putting it in the top 17% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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