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Lam Research (LRCX) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, Lam Research (LRCX - Free Report) closed at $444.54, marking a -1.93% move from the previous day. This change lagged the S&P 500's 0.67% loss on the day. At the same time, the Dow lost 0.57%, and the tech-heavy Nasdaq lost 0.14%.

Coming into today, shares of the semiconductor equipment maker had lost 9.43% in the past month. In that same time, the Computer and Technology sector gained 4.81%, while the S&P 500 gained 3.65%.

Lam Research will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $9.53, up 14% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.92 billion, up 14.21% from the year-ago period.

LRCX's full-year Zacks Consensus Estimates are calling for earnings of $37.60 per share and revenue of $19.34 billion. These results would represent year-over-year changes of +13.53% and +12.25%, respectively.

It is also important to note the recent changes to analyst estimates for Lam Research. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.48% higher. Lam Research is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note Lam Research's current valuation metrics, including its Forward P/E ratio of 12.06. For comparison, its industry has an average Forward P/E of 14.54, which means Lam Research is trading at a discount to the group.

Also, we should mention that LRCX has a PEG ratio of 1.02. 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. Semiconductor Equipment - Wafer Fabrication stocks are, on average, holding a PEG ratio of 1.66 based on yesterday's closing prices.

The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 176, which puts it in the bottom 31% 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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