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Lam Research (LRCX) Gains As Market Dips: What You Should Know

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Lam Research (LRCX - Free Report) closed the most recent trading day at $405.87, moving +0.86% from the previous trading session. This move outpaced the S&P 500's daily loss of 0.92%. Elsewhere, the Dow lost 0.62%, while the tech-heavy Nasdaq added 0.05%.

Coming into today, shares of the semiconductor equipment maker had lost 9.99% in the past month. In that same time, the Computer and Technology sector lost 0.73%, while the S&P 500 lost 1%.

Lam Research will be looking to display strength as it nears its next earnings release, which is expected to be July 27, 2022. On that day, Lam Research is projected to report earnings of $7.30 per share, which would represent a year-over-year decline of 9.77%. Our most recent consensus estimate is calling for quarterly revenue of $4.21 billion, up 1.53% from the year-ago period.

It is also important to note the recent changes to analyst estimates for Lam Research. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.98% lower. Lam Research is currently a Zacks Rank #4 (Sell).

Valuation is also important, so investors should note that Lam Research has a Forward P/E ratio of 10.7 right now. For comparison, its industry has an average Forward P/E of 12.96, which means Lam Research is trading at a discount to the group.

We can also see that LRCX currently has a PEG ratio of 1.04. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Semiconductor Equipment - Wafer Fabrication industry currently had an average PEG ratio of 1.42 as of yesterday's close.

The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 242, which puts it in the bottom 4% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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