Lam Research (NASDAQ:LRCX) Stock Price Down 8.3% - Time to Sell?

Key Points

• Lam Research shares fell 8.3% to about $273.49 in heavy trading, moving below both its 50-day and 200-day moving averages.
• Despite the decline, analysts maintain a generally positive view: the stock has a “Moderate Buy” consensus rating and an average price target of $361.81, well above its trading price.
• The company reported quarterly earnings and revenue above expectations, with revenue up 30% year over year, and increased its quarterly dividend to $0.33 per share. However, insiders have sold roughly $10.6 million of stock over the past 90 days.

Lam Research Corporation (NASDAQ:LRCX - Get Free Report) was down 8.3% during mid-day trading on Monday . The stock traded as low as $273.24 and last traded at $273.49. 13,085,791 shares were traded during mid-day trading, an increase of 20% from the average session volume of 10,883,552 shares. The stock had previously closed at $298.22.

Analysts Set New Price Targets

A number of brokerages have recently commented on LRCX. Barclays reissued an "overweight" rating and set a $335.00 price objective (up from $275.00) on shares of Lam Research in a research note on Thursday, June 11th. Morgan Stanley cut their target price on Lam Research from $404.00 to $367.00 and set an "overweight" rating on the stock in a research report on Thursday, July 30th. HSBC reaffirmed a "hold" rating and set a $333.00 target price on shares of Lam Research in a report on Monday, July 27th. Evercore reissued an "outperform" rating and issued a $355.00 price target on shares of Lam Research in a research note on Monday, July 20th. Finally, Wells Fargo & Company reissued an "overweight" rating and issued a $350.00 price target (down from $450.00) on shares of Lam Research in a research note on Thursday, July 30th. One investment analyst has rated the stock with a Strong Buy rating, twenty-six have issued a Buy rating and five have assigned a Hold rating to the company's stock. According to data from MarketBeat, Lam Research currently has an average rating of "Moderate Buy" and a consensus target price of $361.81.

Lam Research Price Performance

The stock has a market capitalization of $342.22 billion, a price-to-earnings ratio of 47.48, a price-to-earnings-growth ratio of 1.18 and a beta of 1.85. The company has a current ratio of 2.63, a quick ratio of 1.91 and a debt-to-equity ratio of 0.30. The stock has a 50-day simple moving average of $313.37 and a 200 day simple moving average of $294.18.

Lam Research (NASDAQ:LRCX - Get Free Report) last issued its earnings results on Wednesday, July 29th. The semiconductor company reported $1.82 earnings per share for the quarter, beating analysts' consensus estimates of $1.69 by $0.13. The company had revenue of $6.72 billion for 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%.The firm's quarterly revenue was up 30.0% on a year-over-year basis. During the same quarter in the prior year, the company earned $1.33 EPS. Lam Research has set its Q1 2027 guidance at 2.000-2.300 EPS. On average, equities research analysts forecast that Lam Research Corporation will post 9.33 EPS for the current fiscal year.

Lam Research Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Wednesday, October 14th. Shareholders of record on Wednesday, September 23rd will be paid a dividend of $0.33 per share. This is an increase from Lam Research's previous quarterly dividend of $0.26. The ex-dividend date of this dividend is Wednesday, September 23rd. This represents a $1.32 dividend on an annualized basis and a dividend yield of 0.5%. Lam Research's dividend payout ratio (DPR) is 18.06%.

Insider Activity

In related news, Director Bethany Mayer sold 9,557 shares of the stock in a transaction on Wednesday, September 9th. The stock was sold at an average price of $314.74, for a total transaction of $3,007,970.18. Following the completion of the sale, the director directly owned 20,995 shares in the company, valued at approximately $6,607,966.30. This trade represents a 31.28% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, insider Ava Harter sold 5,000 shares of the business's 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 owned 42,462 shares in the company, valued at $12,843,056.52. This trade represents a 10.53% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 32,839 shares of company stock worth $10,644,740 in the last ninety days. Corporate insiders own 0.31% of the company's stock.

Institutional Investors Weigh In On Lam Research

Several institutional investors have recently made changes to their positions in LRCX. California State Teachers Retirement System raised its holdings in shares of Lam Research by 42,619.5% during the 2nd quarter. California State Teachers Retirement System now owns 821,470,614 shares of the semiconductor company's stock valued at $355,967,861,000 after purchasing an additional 819,547,672 shares in the last quarter. Geode Capital Management LLC increased its position in Lam Research by 0.4% during the fourth quarter. Geode Capital Management LLC now owns 33,747,368 shares of the semiconductor company's stock worth $5,764,117,000 after buying an additional 126,613 shares during the last quarter. Bank of America Corp DE raised its holdings in Lam Research by 5.5% during the second quarter. Bank of America Corp DE now owns 11,244,147 shares of the semiconductor company's stock valued at $4,872,426,000 after buying an additional 584,489 shares in the last quarter. Van ECK Associates Corp raised its holdings in Lam Research by 411.8% during the second quarter. Van ECK Associates Corp now owns 11,089,395 shares of the semiconductor company's stock valued at $4,805,368,000 after buying an additional 8,922,854 shares in the last quarter. Finally, Invesco Ltd. lifted its position in shares of Lam Research by 7.7% in the fourth quarter. Invesco Ltd. now owns 22,821,354 shares of the semiconductor company's stock worth $3,906,559,000 after buying an additional 1,638,406 shares during the last quarter. 84.61% of the stock is currently owned by institutional investors and hedge funds.

About Lam Research

Lam Research Corporation is a semiconductor equipment company that develops and manufactures systems used in the fabrication of integrated circuits. Its equipment supports key wafer-processing steps, including deposition, etch, wafer cleaning, and related processes used to create and connect the microscopic features found on semiconductor devices.

The company serves semiconductor manufacturers producing a range of products, including memory, logic, and specialty chips. In addition to manufacturing equipment, Lam Research provides installation, maintenance, spare parts, upgrades, technical support, and other services intended to help customers operate and improve their fabrication facilities.

Founded in 1980, Lam Research is headquartered in Fremont, California, and serves customers through a global network of offices, engineering facilities, and support operations.

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