KLA (NASDAQ:KLAC) Stock Price Target Lowered at Citigroup

Key Points

• Citigroup lowered KLA’s price target to $275 from $290 while maintaining a “Buy” rating, implying substantial upside from the stock’s reported $166.45 price.
• KLA exceeded quarterly expectations, reporting $4.14 billion in revenue and $1.22 in EPS, with revenue up 28.9% year over year; management also issued an above-consensus outlook for the next quarter.
• Analyst sentiment remains positive overall, with a “Moderate Buy” consensus and an average target of $219.28, though several firms have recently trimmed targets amid valuation and longer-term market concerns.

KLA (NASDAQ:KLAC - Get Free Report) had its price objective cut by equities researchers at Citigroup from $290.00 to $275.00 in a research report issued on Thursday, Benzinga reports. The brokerage currently has a "buy" rating on the semiconductor company's stock. Citigroup's price objective indicates a potential upside of 65.22% from the company's current price.

KLAC has been the subject of a number of other reports. Stifel Nicolaus set a $230.00 target price on shares of KLA and gave the company a "buy" rating in a research report on Thursday. Jefferies Financial Group reaffirmed a "buy" rating and issued a $210.00 price target (up from $200.00) on shares of KLA in a report on Wednesday, July 29th. JPMorgan Chase & Co. upped their price objective on KLA from $200.00 to $238.00 and gave the company an "overweight" rating in a research note on Wednesday, July 29th. Wells Fargo & Company reduced their price objective on KLA from $245.00 to $210.00 and set an "overweight" rating for the company in a report on Thursday. Finally, Royal Bank Of Canada reissued a "sector perform" rating and issued a $180.00 target price (up from $170.00) on shares of KLA in a research report on Wednesday, July 29th. Nineteen investment analysts have rated the stock with a Buy rating and ten have given a Hold rating to the company's stock. Based on data from MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and an average price target of $219.28.

KLA Stock Performance

KLA stock traded up $7.68 during mid-day trading on Thursday, reaching $166.45. 8,550,562 shares of the company's stock were exchanged, compared to its average volume of 11,127,328. The business's fifty day simple moving average is $179.57 and its 200 day simple moving average is $181.57. The company has a quick ratio of 2.03, a current ratio of 2.88 and a debt-to-equity ratio of 0.93. KLA has a one year low of $107.20 and a one year high of $307.37. The firm has a market capitalization of $217.22 billion, a PE ratio of 45.40, a P/E/G ratio of 1.29 and a beta of 1.45.

KLA (NASDAQ:KLAC - Get Free Report) last announced its quarterly earnings data on Wednesday, October 28th. The semiconductor company reported $1.22 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.18 by $0.04. The firm had revenue of $4.14 billion during the quarter, compared to the consensus estimate of $4.04 billion. KLA had a return on equity of 87.66% and a net margin of 35.57%. The business's revenue for the quarter was up 28.9% on a year-over-year basis. During the same quarter in the prior year, the company earned $8.47 EPS. On average, sell-side analysts expect that KLA will post 5.43 earnings per share for the current year.

Insider Buying and Selling at KLA

In other KLA news, EVP MaryBeth Wilkinson sold 13,802 shares of the stock in a transaction on Wednesday, August 5th. The stock was sold at an average price of $195.50, for a total transaction of $2,698,291.00. Following the sale, the executive vice president owned 22,110 shares in the company, valued at $4,322,505. This represents a 38.43% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. Also, CAO Virendra Kirloskar sold 4,504 shares of the stock in a transaction on Wednesday, August 5th. The stock was sold at an average price of $195.50, for a total value of $880,532.00. Following the sale, the chief accounting officer owned 7,972 shares in the company, valued at approximately $1,558,526. This represents a 36.10% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 243,339 shares of company stock valued at $46,903,454 in the last quarter. Corporate insiders own 79.39% of the company's stock.

Hedge Funds Weigh In On KLA

Several hedge funds have recently made changes to their positions in KLAC. Wellington Management Group LLP boosted its stake in KLA by 928.9% in the 2nd quarter. Wellington Management Group LLP now owns 14,821,622 shares of the semiconductor company's stock worth $4,471,832,000 after purchasing an additional 13,381,153 shares during the period. Bank of New York Mellon Corp bought a new stake in shares of KLA during the second quarter valued at about $2,522,430,000. Assenagon Asset Management S.A. lifted its holdings in shares of KLA by 239.3% in the third quarter. Assenagon Asset Management S.A. now owns 5,614,990 shares of the semiconductor company's stock worth $1,094,530,000 after buying an additional 3,959,927 shares in the last quarter. National Pension Service lifted its holdings in shares of KLA by 899.4% in the second quarter. National Pension Service now owns 3,634,859 shares of the semiconductor company's stock worth $1,096,673,000 after buying an additional 3,271,158 shares in the last quarter. Finally, PineStone Asset Management Inc. lifted its holdings in shares of KLA by 11.5% in the third quarter. PineStone Asset Management Inc. now owns 2,418,400 shares of the semiconductor company's stock worth $471,419,000 after buying an additional 248,700 shares in the last quarter. 86.65% of the stock is currently owned by hedge funds and other institutional investors.

Key KLA News

Here are the key news stories impacting KLA this week:

• Positive Sentiment: KLA reported fiscal Q1 revenue of $4.14 billion, above the $4.04 billion analyst consensus, while non-GAAP earnings of $1.22 per share exceeded expectations of $1.18. Revenue grew 28.9% year over year, marking the company’s 10th consecutive quarter of growth. KLA Corporation Reports Fiscal 2027 First Quarter Results
• Positive Sentiment: Management projected fiscal Q2 revenue of approximately $4.7 billion, within a $4.5 billion-to-$4.9 billion range and above Wall Street expectations. KLA also expects the wafer-fabrication-equipment market to exceed $200 billion in 2027, supporting demand for its process-control tools. KLA forecasts December-quarter revenue and wafer equipment market outlook
• Positive Sentiment: The semiconductor-equipment sector is benefiting from expectations of prolonged memory-chip shortages and additional fab construction, providing a favorable industry backdrop for KLA. JPMorgan also raised its price target to $240 from $238. Chip equipment stocks rally on memory shortage outlook
• Neutral Sentiment: Several firms lowered their targets following the earnings report: Wells Fargo to $210, Needham to $200, Evercore ISI to $185, Susquehanna to $190, Cantor Fitzgerald to $225 and UBS to $180. Most targets remain above the current share price, while ratings range from overweight to neutral or hold. KLA analysts cut forecasts following Q1 earnings
• Negative Sentiment: The broad reduction in price targets signals concern that KLA’s elevated valuation and structural share-market headwinds limit upside, despite strong operating performance. UBS specifically maintained a Hold rating while citing these longer-term risks. UBS maintains Hold rating on KLA

KLA Company Profile

KLA Corporation NASDAQ: KLAC develops process control, inspection and yield management solutions for the semiconductor and other advanced manufacturing industries. Its technologies help manufacturers identify defects, measure critical dimensions and monitor production processes to improve quality, reliability and manufacturing efficiency.

The company's product portfolio includes wafer and reticle inspection systems, metrology and measurement tools, defect review and classification systems, and software for analyzing manufacturing data.

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