KLA (NASDAQ:KLAC) Reaches New 52-Week High - Still a Buy?

Key Points

• KLA shares hit a new 52-week high of $1,806.75, and analysts hold a consensus "Moderate Buy" with an average price target of $1,614.79 (20 Buys, 11 Holds).
• The company beat expectations last quarter with $8.85 EPS vs. $8.75 est. and revenue of $3.30B (+7.1% YoY), alongside strong profitability (ROE 98.18%, net margin 35.76%).
• KLA’s board authorized a $7.0B share buyback (~3.7% of shares) and paid a quarterly dividend of $1.90 (annualized $7.60, ~0.4% yield, 22.11% payout ratio).

Shares of KLA Corporation (NASDAQ:KLAC - Get Free Report) hit a new 52-week high during mid-day trading on Tuesday . The stock traded as high as $1,806.75 and last traded at $1,805.32, with a volume of 623107 shares trading hands. The stock had previously closed at $1,791.44.

Analysts Set New Price Targets

Several equities research analysts recently issued reports on the company. Needham & Company LLC reiterated a "buy" rating and issued a $1,800.00 price target on shares of KLA in a research note on Monday, March 16th. Royal Bank Of Canada boosted their price target on KLA from $1,550.00 to $1,600.00 and gave the company a "sector perform" rating in a research note on Friday, January 30th. Sanford C. Bernstein set a $1,835.00 price target on KLA and gave the company an "outperform" rating in a research note on Friday, March 13th. Barclays boosted their price target on KLA from $1,595.00 to $1,700.00 and gave the company an "overweight" rating in a research note on Friday, January 30th. Finally, New Street Research boosted their price target on KLA from $1,230.00 to $1,460.00 and gave the company a "neutral" rating in a research note on Tuesday, March 31st. Twenty research analysts have rated the stock with a Buy rating and eleven have issued a Hold rating to the company's stock. According to data from MarketBeat.com, the company currently has a consensus rating of "Moderate Buy" and an average price target of $1,614.79.

KLA Stock Up 0.8%

The firm has a 50 day simple moving average of $1,528.11 and a two-hundred day simple moving average of $1,353.16. The company has a quick ratio of 2.00, a current ratio of 2.83 and a debt-to-equity ratio of 1.08. The stock has a market capitalization of $236.64 billion, a P/E ratio of 52.53, a PEG ratio of 3.38 and a beta of 1.44.

KLA (NASDAQ:KLAC - Get Free Report) last released its earnings results on Thursday, January 29th. The semiconductor company reported $8.85 earnings per share for the quarter, topping the consensus estimate of $8.75 by $0.10. KLA had a return on equity of 98.18% and a net margin of 35.76%.The firm had revenue of $3.30 billion during the quarter, compared to analysts' expectations of $3.25 billion. During the same period in the prior year, the company earned $8.20 earnings per share. The company's quarterly revenue was up 7.1% on a year-over-year basis. On average, equities research analysts expect that KLA Corporation will post 36.64 earnings per share for the current year.

KLA Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Tuesday, March 3rd. Shareholders of record on Tuesday, February 17th were paid a dividend of $1.90 per share. The ex-dividend date was Tuesday, February 17th. This represents a $7.60 annualized dividend and a yield of 0.4%. KLA's dividend payout ratio is presently 22.11%.

KLA announced that its board has authorized a stock repurchase program on Thursday, March 12th that allows the company to buyback $7.00 billion in shares. This buyback authorization allows the semiconductor company to repurchase up to 3.7% of its stock through open market purchases. Stock buyback programs are typically a sign that the company's board of directors believes its shares are undervalued.

Institutional Investors Weigh In On KLA

Several institutional investors and hedge funds have recently added to or reduced their stakes in the business. Motco lifted its stake in KLA by 1.8% during the fourth quarter. Motco now owns 405 shares of the semiconductor company's stock worth $492,000 after purchasing an additional 7 shares during the last quarter. Nemes Rush Group LLC lifted its stake in KLA by 17.1% during the fourth quarter. Nemes Rush Group LLC now owns 48 shares of the semiconductor company's stock worth $58,000 after purchasing an additional 7 shares during the last quarter. SouthState Bank Corp lifted its stake in KLA by 6.7% during the fourth quarter. SouthState Bank Corp now owns 111 shares of the semiconductor company's stock worth $135,000 after purchasing an additional 7 shares during the last quarter. West Michigan Advisors LLC lifted its stake in KLA by 2.7% during the fourth quarter. West Michigan Advisors LLC now owns 305 shares of the semiconductor company's stock worth $371,000 after purchasing an additional 8 shares during the last quarter. Finally, Rothschild Investment LLC lifted its stake in KLA by 0.4% during the third quarter. Rothschild Investment LLC now owns 2,087 shares of the semiconductor company's stock worth $2,251,000 after purchasing an additional 9 shares during the last quarter. 86.65% of the stock is currently owned by institutional investors.

About KLA

KLA is a provider of process control and yield management solutions for the semiconductor and related microelectronics industries. The company designs and manufactures equipment, software and services used by chipmakers to analyze and control manufacturing processes, detect defects, measure critical dimensions and improve yield across wafer fabrication, photomask and packaging operations. KLA's offerings are aimed at enabling production of advanced logic, memory, and specialty devices at progressively smaller technology nodes and more complex package structures.

Its product portfolio includes optical and e-beam inspection systems, metrology tools for critical dimension and film measurement, mask and reticle inspection platforms, as well as enterprise software and data analytics that aggregate process data and drive automated process control.

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