KLA CORP (KLAC)
US4824801009 - Common Stock
Overall KLAC gets a fundamental rating of 6 out of 10. We evaluated KLAC against 107 industry peers in the Semiconductors & Semiconductor Equipment industry. KLAC scores excellent on profitability, but there are some minor concerns on its financial health. KLAC has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year KLAC was profitable.
KLAC had a positive operating cash flow in the past year.
KLAC had positive earnings in each of the past 5 years.
Each year in the past 5 years KLAC had a positive operating cash flow.
1.2 Ratios
KLAC has a better Return On Assets (17.45%) than 90.57% of its industry peers.
KLAC has a better Return On Equity (84.34%) than 99.06% of its industry peers.
KLAC has a better Return On Invested Capital (27.59%) than 98.11% of its industry peers.
KLAC had an Average Return On Invested Capital over the past 3 years of 29.03%. This is significantly above the industry average of 10.71%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.45% | ||
| ROE | 84.34% | ||
| ROIC | 27.59% |
ROA(3y)23.56%
ROA(5y)19.37%
ROE(3y)138.21%
ROE(5y)100.9%
ROIC(3y)29.03%
ROIC(5y)24.11%
1.3 Margins
Looking at the Profit Margin, with a value of 27.19%, KLAC belongs to the top of the industry, outperforming 87.74% of the companies in the same industry.
In the last couple of years the Profit Margin of KLAC has grown nicely.
With an excellent Operating Margin value of 38.21%, KLAC belongs to the best of the industry, outperforming 94.34% of the companies in the same industry.
KLAC's Operating Margin has been stable in the last couple of years.
Looking at the Gross Margin, with a value of 61.50%, KLAC belongs to the top of the industry, outperforming 85.85% of the companies in the same industry.
In the last couple of years the Gross Margin of KLAC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 38.21% | ||
| PM (TTM) | 27.19% | ||
| GM | 61.5% |
OM growth 3Y9.52%
OM growth 5Y0.86%
PM growth 3Y15.47%
PM growth 5Y10.19%
GM growth 3Y2.11%
GM growth 5Y-0.83%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), KLAC is creating value.
Compared to 1 year ago, KLAC has less shares outstanding
Compared to 5 years ago, KLAC has less shares outstanding
KLAC has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 7.05 indicates that KLAC is not in any danger for bankruptcy at the moment.
KLAC has a better Altman-Z score (7.05) than 69.81% of its industry peers.
The Debt to FCF ratio of KLAC is 2.15, which is a good value as it means it would take KLAC, 2.15 years of fcf income to pay off all of its debts.
KLAC's Debt to FCF ratio of 2.15 is fine compared to the rest of the industry. KLAC outperforms 66.04% of its industry peers.
A Debt/Equity ratio of 1.90 is on the high side and indicates that KLAC has dependencies on debt financing.
KLAC's Debt to Equity ratio of 1.90 is on the low side compared to the rest of the industry. KLAC is outperformed by 88.68% 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 | 1.9 | ||
| Debt/FCF | 2.15 | ||
| Altman-Z | 7.05 |
ROIC/WACC2.24
WACC12.3%
2.3 Liquidity
A Current Ratio of 2.14 indicates that KLAC has no problem at all paying its short term obligations.
KLAC has a worse Current ratio (2.14) than 70.75% of its industry peers.
KLAC has a Quick Ratio of 1.46. 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 worse Quick ratio (1.46) than 70.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.14 | ||
| Quick Ratio | 1.46 |
3. Growth
3.1 Past
KLAC shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -12.35%.
The Earnings Per Share has been growing by 25.89% on average over the past years. This is a very strong growth
The Revenue has decreased by -9.68% in the past year.
Measured over the past years, KLAC shows a very strong growth in Revenue. The Revenue has been growing by 21.06% on average per year.
EPS 1Y (TTM)-12.35%
EPS 3Y34.8%
EPS 5Y25.89%
EPS growth Q2Q-4.19%
Revenue 1Y (TTM)-9.68%
Revenue growth 3Y21.82%
Revenue growth 5Y21.06%
Revenue growth Q2Q-2.99%
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 10.85% yearly.
KLAC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.38% yearly.
EPS Next Y-7.96%
EPS Next 2Y5.53%
EPS Next 3Y9.06%
EPS Next 5Y10.85%
Revenue Next Year-7.2%
Revenue Next 2Y2.66%
Revenue Next 3Y5.5%
Revenue Next 5Y5.38%
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
A Price/Earnings ratio of 33.14 indicates a quite expensive valuation of KLAC.
Compared to the rest of the industry, the Price/Earnings ratio of KLAC indicates a somewhat cheap valuation: KLAC is cheaper than 63.21% of the companies listed in the same industry.
KLAC's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.15.
A Price/Forward Earnings ratio of 26.51 indicates a quite expensive valuation of KLAC.
Compared to the rest of the industry, the Price/Forward Earnings ratio of KLAC is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of KLAC to the average of the S&P500 Index (20.20), we can say KLAC is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.14 | ||
| Fwd PE | 26.51 |
4.2 Price Multiples
65.09% of the companies in the same industry are more expensive than KLAC, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of KLAC indicates a somewhat cheap valuation: KLAC is cheaper than 76.42% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.69 | ||
| EV/EBITDA | 24.75 |
4.3 Compensation for Growth
The excellent profitability rating of KLAC may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.28
EPS Next 2Y5.53%
EPS Next 3Y9.06%
5. Dividend
5.1 Amount
KLAC has a yearly dividend return of 0.77%, which is pretty low.
Compared to an average industry Dividend Yield of 1.84, KLAC pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.77, KLAC pays less dividend than the S&P500 average, which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.77% |
5.2 History
The dividend of KLAC is nicely growing with an annual growth rate of 15.00%!
KLAC has been paying a dividend for at least 10 years, so it has a reliable track record.
KLAC has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)15%
Div Incr Years8
Div Non Decr Years8
5.3 Sustainability
KLAC pays out 28.93% of its income as dividend. This is a sustainable payout ratio.
The dividend of KLAC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP28.93%
EPS Next 2Y5.53%
EPS Next 3Y9.06%
KLA CORP
NASDAQ:KLAC (5/17/2024, 7:09:27 PM)
After market: 747.68 0 (0%)747.68
-1.8 (-0.24%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap100.67B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.77% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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Min EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
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Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.14 | ||
| Fwd PE | 26.51 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)1.28
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.45% | ||
| ROE | 84.34% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 38.21% | ||
| PM (TTM) | 27.19% | ||
| GM | 61.5% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.64
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.9 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 2.14 | ||
| Quick Ratio | 1.46 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-12.35%
EPS 3Y34.8%
EPS 5Y
EPS growth Q2Q
EPS Next Y-7.96%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-9.68%
Revenue growth 3Y21.82%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y