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KLA Corporation (KLAC) Hits Fresh High: Is There Still Room to Run?
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Shares of KLA (KLAC - Free Report) have been strong performers lately, with the stock up 5.9% over the past month. The stock hit a new 52-week high of $931.96 in the previous session. KLA has gained 46.5% since the start of the year compared to the 8.1% move for the Zacks Computer and Technology sector and the 12.4% return for the Zacks Electronics - Miscellaneous Products industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on April 30, 2025, KLA reported EPS of $8.41 versus consensus estimate of $8.06.
For the current fiscal year, KLA is expected to post earnings of $33.16 per share on $12.05 in revenues. Meanwhile, for the next fiscal year, the company is expected to earn $37.03 per share on $12.38 in revenues. This represents a year-over-year change of 2.15% and 2.77%, respectively.
Valuation Metrics
While KLA has moved to its 52-week high in the recent past, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
KLA has a Value Score of C. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 27.8X current fiscal year EPS estimates, which is a premium to the peer industry average of 19.5X. On a trailing cash flow basis, the stock currently trades at 31.7X versus its peer group's average of 13.5X. Additionally, the stock has a PEG ratio of 1.72. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, KLA currently has a Zacks Rank of #2 (Buy) thanks to a solid earnings estimate revision trend.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if KLA passes the test. Thus, it seems as though KLA shares could have potential in the weeks and months to come.
How Does KLAC Stack Up to the Competition?
Shares of KLAC have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Universal Electronics Inc. (UEIC - Free Report) . UEIC has a Zacks Rank of #2 (Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of D.
Earnings were strong last quarter. Universal Electronics Inc. beat our consensus estimate by 20.00%, and for the current fiscal year, UEIC is expected to post earnings of $0.52 per share on revenue of $399.18 million.
Shares of Universal Electronics Inc. have gained 0.6% over the past month, and currently trade at a forward P/E of 13.9X and a P/CF of 8.22X.
The Electronics - Miscellaneous Products industry is in the top 31% of all the industries we have in our universe, so it looks like there are some nice tailwinds for KLAC and UEIC, even beyond their own solid fundamental situation.
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KLA Corporation (KLAC) Hits Fresh High: Is There Still Room to Run?
Shares of KLA (KLAC - Free Report) have been strong performers lately, with the stock up 5.9% over the past month. The stock hit a new 52-week high of $931.96 in the previous session. KLA has gained 46.5% since the start of the year compared to the 8.1% move for the Zacks Computer and Technology sector and the 12.4% return for the Zacks Electronics - Miscellaneous Products industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on April 30, 2025, KLA reported EPS of $8.41 versus consensus estimate of $8.06.
For the current fiscal year, KLA is expected to post earnings of $33.16 per share on $12.05 in revenues. Meanwhile, for the next fiscal year, the company is expected to earn $37.03 per share on $12.38 in revenues. This represents a year-over-year change of 2.15% and 2.77%, respectively.
Valuation Metrics
While KLA has moved to its 52-week high in the recent past, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
KLA has a Value Score of C. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 27.8X current fiscal year EPS estimates, which is a premium to the peer industry average of 19.5X. On a trailing cash flow basis, the stock currently trades at 31.7X versus its peer group's average of 13.5X. Additionally, the stock has a PEG ratio of 1.72. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, KLA currently has a Zacks Rank of #2 (Buy) thanks to a solid earnings estimate revision trend.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if KLA passes the test. Thus, it seems as though KLA shares could have potential in the weeks and months to come.
How Does KLAC Stack Up to the Competition?
Shares of KLAC have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Universal Electronics Inc. (UEIC - Free Report) . UEIC has a Zacks Rank of #2 (Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of D.
Earnings were strong last quarter. Universal Electronics Inc. beat our consensus estimate by 20.00%, and for the current fiscal year, UEIC is expected to post earnings of $0.52 per share on revenue of $399.18 million.
Shares of Universal Electronics Inc. have gained 0.6% over the past month, and currently trade at a forward P/E of 13.9X and a P/CF of 8.22X.
The Electronics - Miscellaneous Products industry is in the top 31% of all the industries we have in our universe, so it looks like there are some nice tailwinds for KLAC and UEIC, even beyond their own solid fundamental situation.