KLA Corporation (NASDAQ:KLAC) Holdings Trimmed by Primecap Management Co. CA

Key Points

• Primecap Management Co. CA reduced its stake in KLA Corporation by 5.9%, now holding approximately 4.88 million shares, representing 2.8% of its overall holdings.
• KLA recently announced a $5 billion stock buyback program, allowing it to purchase up to 5.4% of its outstanding shares, potentially indicating that the company believes its shares are undervalued.
• The company increased its quarterly dividend to $1.90 per share, an increase from the previous $1.70, reflecting a strong dividend yield of 0.9% and a payout ratio of 25.01%.

Primecap Management Co. CA trimmed its position in shares of KLA Corporation (NASDAQ:KLAC - Free Report) by 5.9% in the 1st quarter, according to its most recent disclosure with the SEC. The institutional investor owned 4,877,009 shares of the semiconductor company's stock after selling 307,560 shares during the quarter. KLA makes up approximately 2.8% of Primecap Management Co. CA's investment portfolio, making the stock its 5th largest position. Primecap Management Co. CA owned about 3.67% of KLA worth $3,315,391,000 at the end of the most recent quarter.

Several other large investors have also recently made changes to their positions in the company. Hemington Wealth Management increased its position in shares of KLA by 13.1% during the first quarter. Hemington Wealth Management now owns 233 shares of the semiconductor company's stock worth $158,000 after purchasing an additional 27 shares in the last quarter. Nicholas Hoffman & Company LLC. purchased a new stake in shares of KLA during the first quarter worth approximately $220,000. Exencial Wealth Advisors LLC increased its position in shares of KLA by 2.1% during the first quarter. Exencial Wealth Advisors LLC now owns 13,199 shares of the semiconductor company's stock worth $8,973,000 after purchasing an additional 269 shares in the last quarter. Vanguard Group Inc. grew its holdings in KLA by 0.6% in the 1st quarter. Vanguard Group Inc. now owns 13,564,622 shares of the semiconductor company's stock valued at $9,221,230,000 after buying an additional 80,154 shares in the last quarter. Finally, Goldman Sachs Group Inc. grew its holdings in KLA by 27.9% in the 1st quarter. Goldman Sachs Group Inc. now owns 1,852,814 shares of the semiconductor company's stock valued at $1,259,543,000 after buying an additional 404,634 shares in the last quarter. 86.65% of the stock is currently owned by hedge funds and other institutional investors.

KLA Trading Up 0.3%

KLAC traded up $2.74 during mid-day trading on Friday, hitting $914.80. 719,495 shares of the stock were exchanged, compared to its average volume of 1,018,441. The firm's fifty day moving average is $888.42 and its two-hundred day moving average is $774.11. KLA Corporation has a 1-year low of $551.33 and a 1-year high of $945.87. The company has a current ratio of 2.62, a quick ratio of 1.83 and a debt-to-equity ratio of 1.25. The company has a market cap of $120.97 billion, a PE ratio of 30.10, a PEG ratio of 3.12 and a beta of 1.44.

KLA (NASDAQ:KLAC - Get Free Report) last posted its earnings results on Thursday, July 31st. The semiconductor company reported $9.38 earnings per share (EPS) for the quarter, topping the consensus estimate of $8.53 by $0.85. KLA had a return on equity of 112.41% and a net margin of 33.41%. The firm had revenue of $3.17 billion for the quarter, compared to analyst estimates of $3.08 billion. During the same quarter in the prior year, the company earned $6.60 EPS. KLA's revenue was up 23.6% on a year-over-year basis. Equities analysts forecast that KLA Corporation will post 31.59 earnings per share for the current fiscal year.

KLA announced that its Board of Directors has authorized a stock buyback program on Wednesday, April 30th that authorizes the company to buyback $5.00 billion in outstanding shares. This buyback authorization authorizes the semiconductor company to buy up to 5.4% of its stock through open market purchases. Stock buyback programs are often an indication that the company's board of directors believes its shares are undervalued.

KLA Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Wednesday, September 3rd. Investors of record on Monday, August 18th will be paid a dividend of $1.90 per share. The ex-dividend date of this dividend is Monday, August 18th. This represents a $7.60 annualized dividend and a yield of 0.8%. KLA's dividend payout ratio is presently 25.01%.

Insider Activity

In related news, CFO Bren D. Higgins sold 1,019 shares of the stock in a transaction dated Thursday, May 22nd. The stock was sold at an average price of $766.46, for a total transaction of $781,022.74. Following the transaction, the chief financial officer owned 27,779 shares of the company's stock, valued at approximately $21,291,492.34. This represents a 3.54% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, CAO Virendra A. Kirloskar sold 39 shares of the stock in a transaction dated Wednesday, July 2nd. The stock was sold at an average price of $891.50, for a total value of $34,768.50. Following the transaction, the chief accounting officer directly owned 2,616 shares in the company, valued at approximately $2,332,164. The trade was a 1.47% decrease in their position. The disclosure for this sale can be found here. 0.12% of the stock is currently owned by corporate insiders.

Wall Street Analysts Forecast Growth

Several brokerages have issued reports on KLAC. Cowen restated a "hold" rating on shares of KLA in a report on Thursday, May 1st. UBS Group upped their target price on KLA from $775.00 to $960.00 and gave the company a "neutral" rating in a report on Monday, July 21st. Stifel Nicolaus upped their target price on KLA from $770.00 to $922.00 and gave the company a "buy" rating in a report on Friday, August 1st. Morgan Stanley upped their target price on KLA from $916.00 to $928.00 and gave the company an "overweight" rating in a report on Friday, August 1st. Finally, Raymond James Financial restated an "outperform" rating and issued a $950.00 target price (up from $850.00) on shares of KLA in a report on Friday, August 1st. Eleven equities research analysts have rated the stock with a hold rating and eight have issued a buy rating to the company's stock. Based on data from MarketBeat, the stock has a consensus rating of "Hold" and an average target price of $890.59.

KLA Company Profile

KLA Corporation, together with its subsidiaries, engages in the design, manufacture, and marketing of process control, process-enabling, and yield management solutions for the semiconductor and related electronics industries worldwide. It operates through three segments: Semiconductor Process Control; Specialty Semiconductor Process; and PCB and Component Inspection.