KLA (NASDAQ:KLAC) Stock Price Up 7.2% - Still a Buy?

Key Points

• KLA shares surged 7.2% to about $185.48, although trading volume was far below average. Analysts maintain a “Moderate Buy” consensus, with an average price target of $222.22.
• KLA exceeded quarterly expectations, reporting $1.05 in EPS versus the $1.00 estimate and $3.66 billion in revenue, up 15.2% year over year. The company guided for fiscal Q1 2027 EPS of $1.06–$1.26.
• The company raised its quarterly dividend to $0.23 per share, equivalent to a $0.92 annual payout and a 0.5% yield. However, insiders sold roughly $56 million of stock over the past 90 days, while institutions own 86.65% of shares.

KLA Corporation (NASDAQ:KLAC - Get Free Report)'s stock price was up 7.2% on Friday . The company traded as high as $183.71 and last traded at $185.4770. Approximately 1,561,018 shares were traded during mid-day trading, a decline of 86% from the average session volume of 11,280,727 shares. The stock had previously closed at $172.94.

Wall Street Analysts Forecast Growth

A number of analysts have recently issued reports on KLAC shares. UBS Group dropped their target price on KLA from $215.00 to $200.00 and set a "neutral" rating on the stock in a research report on Tuesday. Morgan Stanley restated an "overweight" rating and set a $253.00 price objective on shares of KLA in a research note on Wednesday, July 29th. Rothschild & Co Redburn upped their target price on KLA from $140.00 to $186.50 and gave the company a "neutral" rating in a research report on Tuesday, May 12th. Weiss Ratings reiterated a "buy (b-)" rating on shares of KLA in a research note on Friday, July 31st. Finally, The Goldman Sachs Group reissued a "neutral" rating and set a $230.00 price target on shares of KLA in a research report on Tuesday, July 28th. One investment analyst has rated the stock with a Strong Buy rating, nineteen have issued a Buy rating and nine have issued a Hold rating to the company. According to MarketBeat.com, the company presently has an average rating of "Moderate Buy" and a consensus target price of $222.22.

KLA Trading Up 7.6%

The firm has a market cap of $243.09 billion, a P/E ratio of 50.71, a P/E/G ratio of 1.53 and a beta of 1.45. The business's 50-day moving average is $206.78 and its two-hundred day moving average is $188.65. The company has a current ratio of 2.88, a quick ratio of 2.03 and a debt-to-equity ratio of 0.93.

KLA (NASDAQ:KLAC - Get Free Report) last issued its earnings results on Tuesday, July 28th. The semiconductor company reported $1.05 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $1.00 by $0.05. The firm had revenue of $3.66 billion for the quarter, compared to analysts' expectations of $3.61 billion. KLA had a net margin of 35.57% and a return on equity of 87.66%. KLA's revenue was up 15.2% on a year-over-year basis. During the same quarter last year, the company posted $0.94 earnings per share. KLA has set its Q1 2027 guidance at 1.060-1.260 EPS. As a group, analysts expect that KLA Corporation will post 5.42 earnings per share for the current fiscal year.

KLA Increases Dividend

The business also recently disclosed a quarterly dividend, which was paid on Tuesday, September 1st. Investors of record on Monday, August 17th were given a dividend of $0.23 per share. The ex-dividend date was Monday, August 17th. This represents a $0.92 dividend on an annualized basis and a yield of 0.5%. This is an increase from KLA's previous quarterly dividend of $0.23. KLA's payout ratio is presently 25.07%.

Insider Activity

In other KLA news, CFO Bren Higgins sold 27,701 shares of the stock in a transaction on Thursday, July 2nd. The stock was sold at an average price of $265.69, for a total value of $7,359,878.69. Following the sale, the chief financial officer directly owned 263,472 shares of the company's stock, valued at $70,001,875.68. This trade represents a 9.51% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. Also, CAO Virendra A. Kirloskar sold 4,504 shares of the firm's stock in a transaction on Wednesday, August 5th. The shares were sold at an average price of $195.50, for a total value of $880,532.00. Following the completion of the sale, the chief accounting officer owned 7,972 shares in the company, valued at $1,558,526. The trade was a 36.10% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold 258,533 shares of company stock worth $55,977,470 over the last 90 days. Insiders own 91.48% of the company's stock.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently bought and sold shares of the company. California State Teachers Retirement System increased its stake in shares of KLA by 298,176.3% in the second quarter. California State Teachers Retirement System now owns 599,111,883 shares of the semiconductor company's stock valued at $180,758,046,000 after purchasing an additional 598,911,025 shares during the period. Wellington Management Group LLP boosted its position in shares of KLA by 928.9% during the second quarter. Wellington Management Group LLP now owns 14,821,622 shares of the semiconductor company's stock worth $4,471,832,000 after buying an additional 13,381,153 shares during the period. Bank of New York Mellon Corp acquired a new position in shares of KLA during the second quarter worth approximately $2,522,430,000. NEOS Investment Management LLC grew its holdings in KLA by 987.0% in the 2nd quarter. NEOS Investment Management LLC now owns 979,371 shares of the semiconductor company's stock worth $295,486,000 after buying an additional 889,269 shares in the last quarter. Finally, Railway Pension Investments Ltd grew its holdings in KLA by 960.4% in the 2nd quarter. Railway Pension Investments Ltd now owns 926,652 shares of the semiconductor company's stock worth $279,580,000 after buying an additional 839,265 shares in the last quarter. 86.65% of the stock is owned by institutional investors and hedge funds.

KLA Company Profile

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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