LAM RESEARCH CORP (1LRCX.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1LRCX - US5128073062 - Common Stock
200.35 EUR
+1.47 (+0.74%)
Taking everything into account, 1LRCX scores 6 out of 10 in our fundamental rating. 1LRCX was compared to 69 industry peers in the Semiconductors & Semiconductor Equipment industry. 1LRCX has an excellent profitability rating, but there are some minor concerns on its financial health. 1LRCX is valued quite expensively, but it does show have an excellent growth rating. This makes 1LRCX very considerable for growth investing!
1. Profitability
1.1 Basic Checks
- 1LRCX had positive earnings in the past year.
- In the past year 1LRCX had a positive cash flow from operations.
- In the past 5 years 1LRCX has always been profitable.
- 1LRCX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- 1LRCX has a better Return On Assets (26.53%) than 95.65% of its industry peers.
- 1LRCX's Return On Equity of 57.01% is amongst the best of the industry. 1LRCX outperforms 95.65% of its industry peers.
- 1LRCX has a Return On Invested Capital of 37.82%. This is amongst the best in the industry. 1LRCX outperforms 94.20% of its industry peers.
- 1LRCX had an Average Return On Invested Capital over the past 3 years of 31.47%. This is significantly above the industry average of 14.31%.
- The 3 year average ROIC (31.47%) for 1LRCX is below the current ROIC(37.82%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 26.53% | ||
| ROE | 57.01% | ||
| ROIC | 37.82% |
ROA(3y)23.18%
ROA(5y)24.18%
ROE(3y)51.37%
ROE(5y)58.46%
ROIC(3y)31.47%
ROIC(5y)32.89%
1.3 Margins
- 1LRCX has a Profit Margin of 29.66%. This is amongst the best in the industry. 1LRCX outperforms 82.61% of its industry peers.
- 1LRCX's Profit Margin has improved in the last couple of years.
- 1LRCX has a Operating Margin of 33.00%. This is amongst the best in the industry. 1LRCX outperforms 82.61% of its industry peers.
- In the last couple of years the Operating Margin of 1LRCX has grown nicely.
- With a Gross Margin value of 49.31%, 1LRCX perfoms like the industry average, outperforming 50.72% of the companies in the same industry.
- In the last couple of years the Gross Margin of 1LRCX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 33% | ||
| PM (TTM) | 29.66% | ||
| GM | 49.31% |
OM growth 3Y0.81%
OM growth 5Y3.76%
PM growth 3Y2.83%
PM growth 5Y5.33%
GM growth 3Y2.15%
GM growth 5Y1.2%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), 1LRCX is creating value.
- 1LRCX has less shares outstanding than it did 1 year ago.
- Compared to 5 years ago, 1LRCX has less shares outstanding
- Compared to 1 year ago, 1LRCX has an improved debt to assets ratio.
2.2 Solvency
- The Debt to FCF ratio of 1LRCX is 0.81, which is an excellent value as it means it would take 1LRCX, only 0.81 years of fcf income to pay off all of its debts.
- With a decent Debt to FCF ratio value of 0.81, 1LRCX is doing good in the industry, outperforming 76.81% of the companies in the same industry.
- A Debt/Equity ratio of 0.37 indicates that 1LRCX is not too dependend on debt financing.
- 1LRCX has a Debt to Equity ratio of 0.37. This is in the lower half of the industry: 1LRCX underperforms 66.67% of its industry peers.
- Although 1LRCX does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 0.81 | ||
| Altman-Z | N/A |
ROIC/WACC3.46
WACC10.92%
2.3 Liquidity
- A Current Ratio of 2.21 indicates that 1LRCX has no problem at all paying its short term obligations.
- The Current ratio of 1LRCX (2.21) is comparable to the rest of the industry.
- A Quick Ratio of 1.60 indicates that 1LRCX should not have too much problems paying its short term obligations.
- 1LRCX has a worse Quick ratio (1.60) than 63.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.21 | ||
| Quick Ratio | 1.6 |
3. Growth
3.1 Past
- 1LRCX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 41.65%, which is quite impressive.
- The Earnings Per Share has been growing by 21.02% on average over the past years. This is a very strong growth
- The Revenue has grown by 25.66% in the past year. This is a very strong growth!
- 1LRCX shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.91% yearly.
EPS 1Y (TTM)41.65%
EPS 3Y7.72%
EPS 5Y21.02%
EPS Q2Q%46.51%
Revenue 1Y (TTM)25.66%
Revenue growth 3Y2.29%
Revenue growth 5Y12.91%
Sales Q2Q%27.74%
3.2 Future
- Based on estimates for the next years, 1LRCX will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.46% on average per year.
- The Revenue is expected to grow by 9.82% on average over the next years. This is quite good.
EPS Next Y20.62%
EPS Next 2Y20.38%
EPS Next 3Y17.89%
EPS Next 5Y13.46%
Revenue Next Year16.77%
Revenue Next 2Y16.04%
Revenue Next 3Y13.9%
Revenue Next 5Y9.82%
3.3 Evolution
- The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 52.86, the valuation of 1LRCX can be described as expensive.
- 66.67% of the companies in the same industry are cheaper than 1LRCX, based on the Price/Earnings ratio.
- 1LRCX's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 28.39.
- A Price/Forward Earnings ratio of 39.99 indicates a quite expensive valuation of 1LRCX.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of 1LRCX indicates a slightly more expensive valuation: 1LRCX is more expensive than 63.77% of the companies listed in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.72. 1LRCX is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 52.86 | ||
| Fwd PE | 39.99 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of 1LRCX indicates a slightly more expensive valuation: 1LRCX is more expensive than 73.91% of the companies listed in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of 1LRCX is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 54.29 | ||
| EV/EBITDA | 43.61 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1LRCX does not grow enough to justify the current Price/Earnings ratio.
- The excellent profitability rating of 1LRCX may justify a higher PE ratio.
- A more expensive valuation may be justified as 1LRCX's earnings are expected to grow with 17.89% in the coming years.
PEG (NY)2.56
PEG (5Y)2.52
EPS Next 2Y20.38%
EPS Next 3Y17.89%
5. Dividend
5.1 Amount
- 1LRCX has a yearly dividend return of 0.47%, which is pretty low.
- Compared to an average industry Dividend Yield of 0.74, 1LRCX has a dividend in line with its industry peers.
- With a Dividend Yield of 0.47, 1LRCX pays less dividend than the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.47% |
5.2 History
- The dividend of 1LRCX is nicely growing with an annual growth rate of 14.54%!
Dividend Growth(5Y)14.54%
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
- 1LRCX pays out 20.32% of its income as dividend. This is a sustainable payout ratio.
- The dividend of 1LRCX is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP20.32%
EPS Next 2Y20.38%
EPS Next 3Y17.89%
LAM RESEARCH CORP / 1LRCX.MI FAQ
Can you provide the ChartMill fundamental rating for LAM RESEARCH CORP?
ChartMill assigns a fundamental rating of 6 / 10 to 1LRCX.MI.
What is the valuation status of LAM RESEARCH CORP (1LRCX.MI) stock?
ChartMill assigns a valuation rating of 2 / 10 to LAM RESEARCH CORP (1LRCX.MI). This can be considered as Overvalued.
Can you provide the profitability details for LAM RESEARCH CORP?
LAM RESEARCH CORP (1LRCX.MI) has a profitability rating of 9 / 10.
What is the financial health of LAM RESEARCH CORP (1LRCX.MI) stock?
The financial health rating of LAM RESEARCH CORP (1LRCX.MI) is 6 / 10.
How sustainable is the dividend of LAM RESEARCH CORP (1LRCX.MI) stock?
The dividend rating of LAM RESEARCH CORP (1LRCX.MI) is 3 / 10 and the dividend payout ratio is 20.32%.