Lam Research (NASDAQ:LRCX) Trading Down 1.6% - Should You Sell?

Key Points

• Lam Research shares fell 1.6% to about $306.40 in Monday trading, with volume roughly 39% below the average daily level.
• Wall Street remains broadly positive: the stock has a “Moderate Buy” consensus rating and a $358.47 average price target, implying upside from the trading price, though one analyst downgraded it to “Hold.”
• The company recently beat quarterly expectations with $1.82 in EPS and $6.72 billion in revenue, while revenue grew 30% year over year. However, insiders have sold more than $27.6 million of stock over the past 90 days, a potential cautionary signal.

Lam Research Corporation (NASDAQ:LRCX - Get Free Report) shares were down 1.6% during trading on Monday . The company traded as low as $305.50 and last traded at $306.40. Approximately 6,894,335 shares were traded during mid-day trading, a decline of 39% from the average daily volume of 11,362,171 shares. The stock had previously closed at $311.35.

Wall Street Analyst Weigh In

LRCX has been the subject of several research analyst reports. Rothschild & Co Redburn upped their price objective on Lam Research from $305.00 to $420.00 and gave the company a "buy" rating in a report on Wednesday, June 17th. Royal Bank Of Canada boosted their price target on shares of Lam Research from $290.00 to $310.00 and gave the stock an "outperform" rating in a research report on Thursday, April 23rd. Wall Street Zen downgraded shares of Lam Research from a "buy" rating to a "hold" rating in a report on Sunday, May 10th. Needham & Company LLC restated a "buy" rating and set a $390.00 price objective on shares of Lam Research in a research report on Thursday, July 30th. Finally, Oppenheimer reaffirmed an "outperform" rating and issued a $400.00 price objective (up from $330.00) on shares of Lam Research in a research note on Monday, June 15th. One research analyst has rated the stock with a Strong Buy rating, twenty-six have given a Buy rating and five have issued a Hold rating to the stock. According to data from MarketBeat, Lam Research has an average rating of "Moderate Buy" and a consensus price target of $358.47.

Lam Research Stock Down 1.6%

The stock has a fifty day moving average of $339.89 and a 200-day moving average of $280.04. The firm has a market capitalization of $383.17 billion, a price-to-earnings ratio of 53.19, a PEG ratio of 1.25 and a beta of 1.84. The company has a current ratio of 2.63, a quick ratio of 1.91 and a debt-to-equity ratio of 0.30.

Lam Research (NASDAQ:LRCX - Get Free Report) last announced its earnings results on Wednesday, July 29th. The semiconductor company reported $1.82 EPS for the quarter, beating the consensus estimate of $1.69 by $0.13. The business had revenue of $6.72 billion during the quarter, compared to the consensus estimate of $6.66 billion. Lam Research had a return on equity of 67.60% and a net margin of 31.27%.Lam Research's revenue was up 30.0% compared to the same quarter last year. During the same period in the prior year, the business posted $1.33 earnings per share. Lam Research has set its Q1 2027 guidance at 2.000-2.300 EPS. As a group, sell-side analysts expect that Lam Research Corporation will post 9.24 EPS for the current year.

Lam Research Dividend Announcement

The company also recently announced a quarterly dividend, which was paid on Wednesday, July 8th. Stockholders of record on Wednesday, June 17th were given a $0.26 dividend. This represents a $1.04 annualized dividend and a dividend yield of 0.3%. The ex-dividend date of this dividend was Wednesday, June 17th. Lam Research's dividend payout ratio (DPR) is 18.06%.

Insider Activity

In related news, SVP Neil J. Fernandes sold 7,659 shares of the firm's stock in a transaction that occurred on Monday, June 1st. The shares were sold at an average price of $309.60, for a total value of $2,371,226.40. Following the completion of the transaction, the senior vice president owned 58,470 shares of the company's stock, valued at approximately $18,102,312. This trade represents a 11.58% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Abhijit Y. Talwalkar sold 18,282 shares of Lam Research stock in a transaction that occurred on Monday, July 13th. The stock was sold at an average price of $335.00, for a total transaction of $6,124,470.00. Following the transaction, the director owned 87,142 shares in the company, valued at approximately $29,192,570. The trade was a 17.34% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 80,441 shares of company stock worth $27,614,296 over the last 90 days. 0.31% of the stock is owned by company insiders.

Institutional Trading of Lam Research

A number of hedge funds have recently modified their holdings of LRCX. Paladin Partners LLC purchased a new stake in Lam Research in the 2nd quarter worth about $26,000. Bravera Wealth purchased a new position in Lam Research during the 2nd quarter valued at about $46,000. Cedar Mountain Advisors LLC grew its stake in Lam Research by 242.9% during the 1st quarter. Cedar Mountain Advisors LLC now owns 120 shares of the semiconductor company's stock valued at $26,000 after acquiring an additional 85 shares in the last quarter. Comprehensive Financial Planning Inc. PA acquired a new position in shares of Lam Research in the 2nd quarter valued at about $52,000. Finally, Vermillion Wealth Management Inc. acquired a new position in shares of Lam Research in the 1st quarter valued at about $26,000. Hedge funds and other institutional investors own 84.61% of the company's stock.

Lam Research Company Profile

Lam Research Corporation NASDAQ: LRCX is a global supplier of wafer fabrication equipment and services to the semiconductor industry. Founded in 1980 by David K. Lam and headquartered in Fremont, California, the company develops and manufactures systems used in multiple stages of semiconductor device production, including thin film deposition, plasma etch, wafer cleaning and related process modules and automation.

Lam's product portfolio covers core process technologies employed by logic and memory manufacturers, with equipment designed to support advanced-node patterning, 3D NAND and other emerging device architectures.

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