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KLA (KLAC) Gains But Lags Market: What You Should Know

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KLA (KLAC - Free Report) closed the most recent trading day at $458.06, moving +1.22% from the previous trading session. The stock lagged the S&P 500's daily gain of 1.45%. Meanwhile, the Dow gained 2.12%, and the Nasdaq, a tech-heavy index, added 5.41%.

Heading into today, shares of the maker of equipment for manufacturing semiconductors had gained 21.25% over the past month, outpacing the Computer and Technology sector's gain of 10.26% and the S&P 500's gain of 1.53% in that time.

KLA will be looking to display strength as it nears its next earnings release. In that report, analysts expect KLA to post earnings of $4.82 per share. This would mark a year-over-year decline of 17.04%. Meanwhile, our latest consensus estimate is calling for revenue of $2.25 billion, down 9.63% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $24.88 per share and revenue of $10.39 billion, which would represent changes of +17.64% and +12.77%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for KLA. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

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. Over the past month, the Zacks Consensus EPS estimate has moved 0.08% higher. KLA currently has a Zacks Rank of #3 (Hold).

Digging into valuation, KLA currently has a Forward P/E ratio of 18.19. Its industry sports an average Forward P/E of 18.24, so we one might conclude that KLA is trading at a discount comparatively.

Also, we should mention that KLAC has a PEG ratio of 2.74. 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. KLAC's industry had an average PEG ratio of 1.87 as of yesterday's close.

The Electronics - Miscellaneous Products industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 160, which puts it in the bottom 37% 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

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