Back to top

Image: Bigstock

Lam Research (LRCX) Sees a More Significant Dip Than Broader Market: Some Facts to Know

Read MoreHide Full Article

In the latest close session, Lam Research (LRCX - Free Report) was down 1.19% at $173.78. The stock's performance was behind the S&P 500's daily loss of 0.14%. Elsewhere, the Dow saw a downswing of 0.2%, while the tech-heavy Nasdaq depreciated by 0.24%.

Coming into today, shares of the semiconductor equipment maker had gained 13.62% in the past month. In that same time, the Computer and Technology sector gained 0.2%, while the S&P 500 gained 0.94%.

Investors will be eagerly watching for the performance of Lam Research in its upcoming earnings disclosure. The company is forecasted to report an EPS of $1.15, showcasing a 26.37% upward movement from the corresponding quarter of the prior year. Meanwhile, the latest consensus estimate predicts the revenue to be $5.22 billion, indicating a 19.23% increase compared to the same quarter of the previous year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $4.79 per share and a revenue of $21.04 billion, representing changes of +15.7% and +14.11%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Lam Research. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable 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 past month, the Zacks Consensus EPS estimate has moved 0.05% higher. As of now, Lam Research holds a Zacks Rank of #2 (Buy).

Digging into valuation, Lam Research currently has a Forward P/E ratio of 36.72. This expresses a premium compared to the average Forward P/E of 36.1 of its industry.

One should further note that LRCX currently holds a PEG ratio of 2.03. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. LRCX's industry had an average PEG ratio of 2.04 as of yesterday's close.

The Electronics - Semiconductors industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 106, which puts it in the top 43% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Lam Research Corporation (LRCX) - free report >>

Published in