Lam Research (LRCX) Outpaces Stock Market Gains: What You Should Know
In the latest trading session, Lam Research (LRCX) closed at $726.75, marking a +1.49% move from the previous day.
Lam Research (LRCX) closed at $726.75 in the latest trading session, marking a +1.49% move from the prior day. This move outpaced the S&P 500's daily gain of 0.14%. Meanwhile, the Dow gained 0.25%, and the Nasdaq, a tech-heavy index, lost 0.34%.
Coming into today, shares of the semiconductor equipment maker had gained 5.33% in the past month. In that same time, the Computer and Technology sector gained 2.85%, while the S&P 500 gained 4.32%.
Investors will be hoping for strength from Lam Research as it approaches its next earnings release. The company is expected to report EPS of $8.46, up 40.3% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $4.4 billion, up 27.38% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $34.29 per share and revenue of $17.76 billion. These totals would mark changes of +25.88% and +21.44%, respectively, from last year.
Any recent changes to analyst estimates for Lam Research should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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.
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. The Zacks Consensus EPS estimate remained stagnant within the past month. Lam Research is holding a Zacks Rank of #2 (Buy) right now.
Valuation is also important, so investors should note that Lam Research has a Forward P/E ratio of 20.88 right now. This valuation marks a premium compared to its industry's average Forward P/E of 20.72.
It is also worth noting that LRCX currently has a PEG ratio of 1.23. 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 1.52 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 71, putting it in the top 28% 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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