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Lam Research (LRCX) Stock Falls Amid Market Uptick: What Investors Need to Know

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The latest trading session saw Lam Research (LRCX - Free Report) ending at $731.24, denoting a -0.59% adjustment from its last day's close. The stock fell short of the S&P 500, which registered a gain of 0.46% for the day. At the same time, the Dow added 0.48%, and the tech-heavy Nasdaq gained 0.7%.

Heading into today, shares of the semiconductor equipment maker had gained 9.23% over the past month, outpacing the Computer and Technology sector's gain of 4.16% and the S&P 500's gain of 4.85% in that time.

Investors will be eagerly watching for the performance of Lam Research in its upcoming earnings disclosure. The company is expected to report EPS of $7.05, down 34.17% from the prior-year quarter. Meanwhile, the latest consensus estimate predicts the revenue to be $3.71 billion, indicating a 29.72% decrease compared to the same quarter of the previous year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $27.65 per share and a revenue of $14.66 billion, representing changes of -19.08% and -15.9%, respectively, from the prior year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for Lam Research. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. At present, Lam Research boasts a Zacks Rank of #3 (Hold).

In terms of valuation, Lam Research is currently trading at a Forward P/E ratio of 26.6. This denotes a premium relative to the industry's average Forward P/E of 23.68.

Meanwhile, LRCX's PEG ratio is currently 5.09. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Semiconductor Equipment - Wafer Fabrication industry currently had an average PEG ratio of 3.79 as of yesterday's close.

The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 90, finds itself in the top 36% echelons of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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