Lam Research (NASDAQ:LRCX) Shares Up 3.2% - Time to Buy?

Key Points

• Lam Research shares rose 3.2% to $237.50 on above-average volume, despite trading below both its 50-day and 200-day moving averages.
• The latest quarter showed strong momentum: revenue increased 54.4% year over year to $8.22 billion, while EPS of $2.20 exceeded analyst expectations. Analysts maintain a “Moderate Buy” consensus with an average price target of $354.55.
• Investors remain divided between Lam Research’s exposure to AI, advanced memory and logic chip demand and risks including semiconductor-stock rotation, elevated valuation and potential corrections in AI-linked equities.

Lam Research Corporation (NASDAQ:LRCX - Get Free Report)'s stock price was up 3.2% on Monday. The company traded as high as $241.25 and last traded at $237.50. 11,583,037 shares were traded during mid-day trading, an increase of 8% from the average session volume of 10,762,038 shares. The stock had previously closed at $230.10.

Lam Research News Summary

Here are the key news stories impacting Lam Research this week:

• Positive Sentiment: Analyst sentiment improved, including an upgrade arguing that Lam Research’s valuation and earnings outlook have become more attractive after the stock’s recent decline. A separate analyst also raised the company’s FY2027 EPS forecast, supporting the case for earnings-driven upside. Lam Research upgrade analysis FY2027 EPS forecast
• Positive Sentiment: Long-term growth articles highlighted Lam Research’s exposure to advanced memory, logic and AI-related chip manufacturing. Bulls also pointed to strong cash generation, a favorable forward valuation relative to some peers and potential upside if semiconductor capital spending remains robust. Long-term growth analysis Lam Research versus peers
• Positive Sentiment: The company’s latest quarterly results remain a fundamental support: revenue reached $8.22 billion, up 54.4% year over year, while EPS of $2.20 exceeded consensus. The strong results reinforce expectations for continued demand for wafer-fabrication equipment. Lam Research earnings quality analysis
• Neutral Sentiment: Lam Research gained even after Citi cut its price target, suggesting investors viewed the reduction as a valuation adjustment rather than a change to the company’s underlying growth story. Citi target cut
• Negative Sentiment: Risks include a broader rotation away from chip stocks toward cybersecurity, recent corrections in AI-linked equities and questions about whether record results are already reflected in Lam Research’s elevated valuation. AI trade rotation Earnings valuation concerns

Wall Street Analysts Forecast Growth

Several research analysts recently commented on the stock. Evercore set a $315.00 price objective on shares of Lam Research in a research note on Tuesday, October 20th. Mizuho lowered their target price on shares of Lam Research from $365.00 to $360.00 and set an "outperform" rating for the company in a research note on Thursday. Morgan Stanley set a $339.00 price target on shares of Lam Research and gave the stock an "overweight" rating in a report on Thursday. Susquehanna reaffirmed a "positive" rating and set a $475.00 price target (up from $385.00) on shares of Lam Research in a research report on Tuesday, June 30th. Finally, B. Riley Financial increased their price objective on Lam Research from $350.00 to $390.00 and gave the company a "buy" rating in a report on Thursday, October 1st. Twenty-six research analysts have rated the stock with a Buy rating and six have given a Hold rating to the company. According to data from MarketBeat.com, the company presently has an average rating of "Moderate Buy" and a consensus price target of $354.55.

Lam Research Stock Up 3.2%

The company's 50-day moving average is $301.90 and its 200 day moving average is $309.95. The stock has a market capitalization of $296.68 billion, a PE ratio of 35.39, a price-to-earnings-growth ratio of 0.86 and a beta of 1.85. The company has a current ratio of 2.48, a quick ratio of 1.86 and a debt-to-equity ratio of 0.27.

Lam Research (NASDAQ:LRCX - Get Free Report) last released its earnings results on Wednesday, October 21st. The semiconductor company reported $2.20 earnings per share for the quarter, topping the consensus estimate of $2.18 by $0.02. Lam Research had a net margin of 32.34% and a return on equity of 72.15%. The company had revenue of $8.22 billion for the quarter, compared to the consensus estimate of $8.14 billion. During the same quarter in the previous year, the firm earned $1.26 EPS. Lam Research's revenue was up 54.4% compared to the same quarter last year. As a group, analysts anticipate that Lam Research Corporation will post 9.48 EPS for the current year.

Lam Research Increases Dividend

The company also recently declared a quarterly dividend, which was paid on Wednesday, October 14th. Shareholders of record on Wednesday, September 23rd were given a dividend of $0.33 per share. The ex-dividend date of this dividend was Wednesday, September 23rd. This represents a $1.32 dividend on an annualized basis and a yield of 0.6%. This is an increase from Lam Research's previous quarterly dividend of $0.26. Lam Research's payout ratio is presently 19.67%.

Insider Transactions at Lam Research

In other news, Director Bethany Mayer sold 9,557 shares of the stock in a transaction dated Wednesday, September 9th. The stock was sold at an average price of $314.74, for a total value of $3,007,970.18. Following the transaction, the director directly owned 20,995 shares of the company's stock, valued at approximately $6,607,966.30. This represents a 31.28% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. Also, insider Ava Harter sold 5,000 shares of the stock in a transaction dated Monday, August 31st. The shares were sold at an average price of $302.46, for a total value of $1,512,300.00. Following the completion of the transaction, the insider directly owned 42,462 shares in the company, valued at $12,843,056.52. This represents a 10.53% 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 own 0.31% of the company's stock.

Hedge Funds Weigh In On Lam Research

Hedge funds and other institutional investors have recently bought and sold shares of the business. Flagship Harbor Advisors LLC boosted its holdings in shares of Lam Research by 9.7% in the 3rd quarter. Flagship Harbor Advisors LLC now owns 1,153 shares of the semiconductor company's stock valued at $379,000 after acquiring an additional 102 shares during the last quarter. RD Finance Ltd purchased a new position in shares of Lam Research during the third quarter worth $858,000. Deroy & Devereaux Private Investment Counsel Inc. raised its holdings in shares of Lam Research by 0.4% during the third quarter. Deroy & Devereaux Private Investment Counsel Inc. now owns 130,176 shares of the semiconductor company's stock worth $42,764,000 after purchasing an additional 559 shares during the last quarter. Westover Capital Advisors LLC lifted its position in Lam Research by 13.8% during the third quarter. Westover Capital Advisors LLC now owns 9,371 shares of the semiconductor company's stock valued at $3,078,000 after purchasing an additional 1,139 shares during the period. Finally, Peterson Wealth Services lifted its position in Lam Research by 11.9% during the third quarter. Peterson Wealth Services now owns 1,968 shares of the semiconductor company's stock valued at $647,000 after purchasing an additional 210 shares during the period. Institutional investors and hedge funds own 84.61% of the company's stock.

Lam Research Company Profile

Lam Research Corporation NASDAQ: LRCX is a semiconductor equipment company that develops and manufactures systems used to fabricate integrated circuits. Its technologies support key stages of wafer processing, helping semiconductor manufacturers create the increasingly complex structures found in memory, logic and other types of chips.

The company's product portfolio includes etch systems, which selectively remove materials from wafers; deposition systems, which apply thin films; and cleaning solutions used to remove contaminants and residue during manufacturing.

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