1498.29 USD
-1.71 (-0.11%)
Taking everything into account, KLAC scores 7 out of 10 in our fundamental rating. KLAC was compared to 113 industry peers in the Semiconductors & Semiconductor Equipment industry. Both the health and profitability get an excellent rating, making KLAC a very profitable company, without any liquidiy or solvency issues. KLAC is growing strongly while it is still valued neutral. This is a good combination! These ratings could make KLAC a good candidate for growth and quality investing.
1. Profitability
1.1 Basic Checks
- KLAC had positive earnings in the past year.
- In the past year KLAC had a positive cash flow from operations.
- In the past 5 years KLAC has always been profitable.
- Each year in the past 5 years KLAC had a positive operating cash flow.
1.2 Ratios
- Looking at the Return On Assets, with a value of 25.96%, KLAC belongs to the top of the industry, outperforming 97.35% of the companies in the same industry.
- With an excellent Return On Equity value of 84.99%, KLAC belongs to the best of the industry, outperforming 99.11% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 38.07%, KLAC belongs to the top of the industry, outperforming 99.11% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for KLAC is significantly above the industry average of 10.75%.
- The 3 year average ROIC (34.16%) for KLAC is below the current ROIC(38.07%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 25.96% | ||
| ROE | 84.99% | ||
| ROIC | 38.07% |
ROA(3y)22.41%
ROA(5y)22.77%
ROE(3y)94.85%
ROE(5y)116.64%
ROIC(3y)34.16%
ROIC(5y)32.64%
1.3 Margins
- With an excellent Profit Margin value of 33.83%, KLAC belongs to the best of the industry, outperforming 92.92% of the companies in the same industry.
- In the last couple of years the Profit Margin of KLAC has grown nicely.
- KLAC has a Operating Margin of 42.86%. This is amongst the best in the industry. KLAC outperforms 97.35% of its industry peers.
- KLAC's Operating Margin has improved in the last couple of years.
- KLAC has a Gross Margin of 61.99%. This is amongst the best in the industry. KLAC outperforms 86.73% of its industry peers.
- KLAC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 42.86% | ||
| PM (TTM) | 33.83% | ||
| GM | 61.99% |
OM growth 3Y-0.21%
OM growth 5Y6.37%
PM growth 3Y-2.51%
PM growth 5Y9.77%
GM growth 3Y-1.04%
GM growth 5Y1.05%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), KLAC is creating value.
- KLAC has less shares outstanding than it did 1 year ago.
- KLAC has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, KLAC has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 13.01 indicates that KLAC is not in any danger for bankruptcy at the moment.
- With a decent Altman-Z score value of 13.01, KLAC is doing good in the industry, outperforming 76.11% of the companies in the same industry.
- The Debt to FCF ratio of KLAC is 1.52, which is an excellent value as it means it would take KLAC, only 1.52 years of fcf income to pay off all of its debts.
- KLAC has a better Debt to FCF ratio (1.52) than 70.80% of its industry peers.
- A Debt/Equity ratio of 1.18 is on the high side and indicates that KLAC has dependencies on debt financing.
- The Debt to Equity ratio of KLAC (1.18) is worse than 88.50% of its industry peers.
- Although KLAC 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 | 1.18 | ||
| Debt/FCF | 1.52 | ||
| Altman-Z | 13.01 |
ROIC/WACC3.52
WACC10.81%
2.3 Liquidity
- A Current Ratio of 2.69 indicates that KLAC has no problem at all paying its short term obligations.
- KLAC has a Current ratio (2.69) which is in line with its industry peers.
- KLAC has a Quick Ratio of 1.88. This is a normal value and indicates that KLAC is financially healthy and should not expect problems in meeting its short term obligations.
- With a Quick ratio value of 1.88, KLAC perfoms like the industry average, outperforming 40.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.69 | ||
| Quick Ratio | 1.88 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 37.28% over the past year.
- The Earnings Per Share has been growing by 26.37% on average over the past years. This is a very strong growth
- Looking at the last year, KLAC shows a very strong growth in Revenue. The Revenue has grown by 22.11%.
- Measured over the past years, KLAC shows a quite strong growth in Revenue. The Revenue has been growing by 15.93% on average per year.
EPS 1Y (TTM)37.28%
EPS 3Y16.32%
EPS 5Y26.37%
EPS Q2Q%20.19%
Revenue 1Y (TTM)22.11%
Revenue growth 3Y9.69%
Revenue growth 5Y15.93%
Sales Q2Q%12.96%
3.2 Future
- KLAC is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.51% yearly.
- Based on estimates for the next years, KLAC will show a quite strong growth in Revenue. The Revenue will grow by 8.56% on average per year.
EPS Next Y9.51%
EPS Next 2Y13.36%
EPS Next 3Y11.96%
EPS Next 5Y12.51%
Revenue Next Year8.63%
Revenue Next 2Y11.14%
Revenue Next 3Y9.35%
Revenue Next 5Y8.56%
3.3 Evolution
- Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of 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 43.05, the valuation of KLAC can be described as expensive.
- Compared to the rest of the industry, the Price/Earnings ratio of KLAC indicates a somewhat cheap valuation: KLAC is cheaper than 69.91% of the companies listed in the same industry.
- When comparing the Price/Earnings ratio of KLAC to the average of the S&P500 Index (27.30), we can say KLAC is valued expensively.
- KLAC is valuated quite expensively with a Price/Forward Earnings ratio of 34.99.
- 62.83% of the companies in the same industry are more expensive than KLAC, based on the Price/Forward Earnings ratio.
- The average S&P500 Price/Forward Earnings ratio is at 24.32. KLAC is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 43.05 | ||
| Fwd PE | 34.99 |
4.2 Price Multiples
- KLAC's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. KLAC is cheaper than 66.37% of the companies in the same industry.
- KLAC's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. KLAC is cheaper than 70.80% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 50.83 | ||
| EV/EBITDA | 33.93 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates KLAC does not grow enough to justify the current Price/Earnings ratio.
- The excellent profitability rating of KLAC may justify a higher PE ratio.
PEG (NY)4.53
PEG (5Y)1.63
EPS Next 2Y13.36%
EPS Next 3Y11.96%
5. Dividend
5.1 Amount
- KLAC has a yearly dividend return of 0.49%, which is pretty low.
- Compared to an average industry Dividend Yield of 0.51, KLAC pays a bit more dividend than its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.82, KLAC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.49% |
5.2 History
- On average, the dividend of KLAC grows each year by 15.33%, which is quite nice.
- KLAC has been paying a dividend for at least 10 years, so it has a reliable track record.
- KLAC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)15.33%
Div Incr Years15
Div Non Decr Years19
5.3 Sustainability
- 22.67% of the earnings are spent on dividend by KLAC. This is a low number and sustainable payout ratio.
- The dividend of KLAC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP22.67%
EPS Next 2Y13.36%
EPS Next 3Y11.96%
KLA CORP / KLAC FAQ
What is the ChartMill fundamental rating of KLA CORP (KLAC) stock?
ChartMill assigns a fundamental rating of 7 / 10 to KLAC.
Can you provide the valuation status for KLA CORP?
ChartMill assigns a valuation rating of 4 / 10 to KLA CORP (KLAC). This can be considered as Fairly Valued.
Can you provide the profitability details for KLA CORP?
KLA CORP (KLAC) has a profitability rating of 9 / 10.
What is the financial health of KLA CORP (KLAC) stock?
The financial health rating of KLA CORP (KLAC) is 7 / 10.
Can you provide the expected EPS growth for KLAC stock?
The Earnings per Share (EPS) of KLA CORP (KLAC) is expected to grow by 9.51% in the next year.