1500 USD
-20 (-1.32%)
1482.98 USD
-17.02 (-1.13%)
KLAC gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 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 not overvalued while it is showing excellent growth. This is an interesting combination. With these ratings, KLAC could be worth investigating further 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.
- In the past 5 years KLAC always reported a positive cash flow from operatings.
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.
- KLAC has a Return On Equity of 84.99%. This is amongst the best in the industry. KLAC outperforms 99.11% of its industry peers.
- KLAC has a Return On Invested Capital of 38.07%. This is amongst the best in the industry. KLAC outperforms 99.11% of its industry peers.
- 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
- KLAC has a better Profit Margin (33.83%) than 92.92% of its industry peers.
- In the last couple of years the Profit Margin of KLAC has grown nicely.
- The Operating Margin of KLAC (42.86%) is better than 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.
- The number of shares outstanding for KLAC has been reduced compared to 1 year ago.
- The number of shares outstanding for KLAC has been reduced compared to 5 years ago.
- KLAC has a better debt/assets ratio than last year.
2.2 Solvency
- KLAC has an Altman-Z score of 13.14. This indicates that KLAC is financially healthy and has little risk of bankruptcy at the moment.
- With a decent Altman-Z score value of 13.14, 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.
- Looking at the Debt to FCF ratio, with a value of 1.52, KLAC is in the better half of the industry, outperforming 70.80% of the companies in the same industry.
- A Debt/Equity ratio of 1.18 is on the high side and indicates that KLAC has dependencies on debt financing.
- KLAC's Debt to Equity ratio of 1.18 is on the low side compared to the rest of the industry. KLAC is outperformed by 88.50% of its industry peers.
- Even though the debt/equity ratio score it not favorable for KLAC, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.18 | ||
| Debt/FCF | 1.52 | ||
| Altman-Z | 13.14 |
ROIC/WACC3.52
WACC10.81%
2.3 Liquidity
- KLAC has a Current Ratio of 2.69. This indicates that KLAC is financially healthy and has no problem in meeting its short term obligations.
- The Current ratio of KLAC (2.69) is comparable to the rest of the industry.
- 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.
- KLAC has a Quick ratio of 1.88. This is comparable to the rest of the industry: KLAC outperforms 40.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.69 | ||
| Quick Ratio | 1.88 |
3. Growth
3.1 Past
- KLAC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 37.28%, which is quite impressive.
- The Earnings Per Share has been growing by 26.37% on average over the past years. This is a very strong growth
- The Revenue has grown by 22.11% in the past year. This is a very strong growth!
- The Revenue has been growing by 15.93% on average over the past years. This is quite good.
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
- The Earnings Per Share is expected to grow by 12.51% on average over the next years. This is quite good.
- KLAC is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.56% yearly.
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
- 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
- With a Price/Earnings ratio of 43.10, KLAC can be considered very expensive at the moment.
- KLAC's Price/Earnings ratio is a bit cheaper when compared to the industry. KLAC is cheaper than 69.03% of the companies in the same industry.
- KLAC is valuated expensively when we compare the Price/Earnings ratio to 27.32, which is the current average of the S&P500 Index.
- KLAC is valuated quite expensively with a Price/Forward Earnings ratio of 35.03.
- Based on the Price/Forward Earnings ratio, KLAC is valued a bit cheaper than the industry average as 62.83% of the companies are valued more expensively.
- KLAC is valuated rather expensively when we compare the Price/Forward Earnings ratio to 24.32, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 43.1 | ||
| Fwd PE | 35.03 |
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.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of KLAC indicates a somewhat cheap valuation: KLAC is cheaper than 71.68% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 50.89 | ||
| EV/EBITDA | 34.39 |
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
- With a yearly dividend of 0.49%, KLAC is not a good candidate for dividend investing.
- KLAC's Dividend Yield is a higher than the industry average which is at 0.51.
- With a Dividend Yield of 0.49, KLAC pays less dividend than the S&P500 average, which is at 1.83.
| 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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
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.