Lam Research (NASDAQ:LRCX) Trading Down 3.7% After Insider Selling

Key Points

• Lam Research shares fell 3.7% to about $290 after insider Ava Harter sold 5,000 shares worth $1.51 million under a pre-arranged Rule 10b5-1 plan.
• Analysts remain broadly positive, with a “Moderate Buy” consensus and an average price target of $358.97, despite several recent target reductions.
• The company reported strong fundamentals, including 30% year-over-year revenue growth, earnings above estimates, and a quarterly dividend increase from $0.26 to $0.33 per share.

Lam Research Corporation (NASDAQ:LRCX - Get Free Report) dropped 3.7% during mid-day trading on Tuesday after an insider sold shares in the company. The company traded as low as $286.59 and last traded at $290.20. 8,153,049 shares were traded during mid-day trading, a decline of 26% from the average daily volume of 11,003,866 shares. The stock had previously closed at $301.49.

Specifically, insider Ava Harter sold 5,000 shares of the firm's stock in a transaction dated Monday, August 31st. The stock was sold at an average price of $302.46, for a total value of $1,512,300.00. Following the transaction, the insider owned 42,462 shares of the company's stock, valued at $12,843,056.52. This trade represents a 10.53% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.

Wall Street Analyst Weigh In

A number of research analysts recently issued reports on LRCX shares. Mizuho cut their price objective on Lam Research from $370.00 to $365.00 and set an "outperform" rating for the company in a research note on Tuesday, August 25th. Morgan Stanley decreased their target price on shares of Lam Research from $404.00 to $367.00 and set an "overweight" rating on the stock in a research note on Thursday, July 30th. Stifel Nicolaus lifted their price target on shares of Lam Research from $325.00 to $425.00 and gave the company a "buy" rating in a report on Friday, July 10th. TD Cowen reiterated a "buy" rating and issued a $400.00 price target (up from $340.00) on shares of Lam Research in a research report on Thursday, July 9th. Finally, B. Riley Financial reduced their price objective on shares of Lam Research from $385.00 to $350.00 and set a "buy" rating for the company 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 issued a Hold rating to the company's stock. According to MarketBeat, the company has an average rating of "Moderate Buy" and an average target price of $358.97.

Key Stories Impacting Lam Research

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

• Positive Sentiment: UBS maintained a Buy rating on Lam Research while lowering its price target from $435 to $425. The revised target still implies substantial upside, signaling that the firm views the recent pullback as an attractive entry point. UBS price target report
• Positive Sentiment: Recent commentary continues to highlight strong semiconductor and artificial-intelligence infrastructure demand. Lam’s latest quarterly results exceeded analyst expectations, with revenue rising 30% year over year, while the company also raised its dividend by 27%. Lam Research dividend article
• Positive Sentiment: Analysts and investment commentary describe Lam Research as potentially undervalued following its summer pullback, citing semiconductor production growth and the ongoing AI-driven equipment spending cycle. Lam Research pullback analysis

Lam Research Trading Down 3.7%

The stock has a fifty day moving average of $328.26 and a 200 day moving average of $290.09. The company has a debt-to-equity ratio of 0.30, a quick ratio of 1.91 and a current ratio of 2.63. The company has a market capitalization of $363.13 billion, a PE ratio of 50.38, a PEG ratio of 1.20 and a beta of 1.84.

Lam Research (NASDAQ:LRCX - Get Free Report) last announced its quarterly earnings data on Wednesday, July 29th. The semiconductor company reported $1.82 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.69 by $0.13. The business had revenue of $6.72 billion during the quarter, compared to analyst estimates of $6.66 billion. Lam Research had a net margin of 31.27% and a return on equity of 67.60%. The company's revenue was up 30.0% on a year-over-year basis. During the same period last year, the firm posted $1.33 EPS. Lam Research has set its Q1 2027 guidance at 2.000-2.300 EPS. As a group, sell-side analysts predict that Lam Research Corporation will post 9.33 earnings per share 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. Investors of record on Wednesday, September 23rd will be paid a dividend of $0.33 per share. The ex-dividend date of this dividend is Wednesday, September 23rd. This is a positive change from Lam Research's previous quarterly dividend of $0.26. This represents a $1.32 annualized dividend and a yield of 0.5%. Lam Research's dividend payout ratio is 18.06%.

Institutional Trading of Lam Research

Institutional investors and hedge funds have recently bought and sold shares of the stock. California State Teachers Retirement System increased its holdings in shares of Lam Research by 42,619.5% in the second quarter. California State Teachers Retirement System now owns 821,470,614 shares of the semiconductor company's stock worth $355,967,861,000 after purchasing an additional 819,547,672 shares during the last quarter. Norges Bank purchased a new stake in shares of Lam Research in the fourth quarter worth about $3,645,427,000. Price T Rowe Associates Inc. MD boosted its stake in Lam Research by 352.2% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 13,695,210 shares of the semiconductor company's stock valued at $2,344,347,000 after buying an additional 10,666,540 shares during the last quarter. Van ECK Associates Corp boosted its stake 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 during the last quarter. Finally, Bank of New York Mellon Corp purchased a new position in Lam Research during the 2nd quarter valued at approximately $3,777,585,000. 84.61% of the stock is currently owned by institutional investors.

About Lam Research

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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