1512.78 USD
+12.78 (+0.85%)
1510.01 USD
-2.77 (-0.18%)
Overall KLAC gets a fundamental rating of 7 out of 10. We evaluated KLAC against 113 industry peers in the Semiconductors & Semiconductor Equipment industry. KLAC has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. KLAC is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one! This makes KLAC very considerable 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.
- KLAC had positive earnings in each of the past 5 years.
- In the past 5 years KLAC always reported a positive cash flow from operatings.
1.2 Ratios
- The Return On Assets of KLAC (25.96%) is better than 97.35% of its industry peers.
- KLAC has a better Return On Equity (84.99%) than 99.11% of its industry peers.
- 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.
- KLAC had an Average Return On Invested Capital over the past 3 years of 34.16%. This 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
- Looking at the Profit Margin, with a value of 33.83%, KLAC belongs to the top of the industry, outperforming 92.92% of the companies in the same industry.
- KLAC's Profit Margin has improved in the last couple of years.
- KLAC's Operating Margin of 42.86% is amongst the best of the industry. KLAC outperforms 97.35% of its industry peers.
- In the last couple of years the Operating Margin of KLAC has grown nicely.
- KLAC has a better Gross Margin (61.99%) than 86.73% of its industry peers.
- 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 | 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
- KLAC has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
- Compared to 1 year ago, KLAC has less shares outstanding
- The number of shares outstanding for KLAC has been reduced compared to 5 years ago.
- The debt/assets ratio for KLAC has been reduced compared to a year ago.
2.2 Solvency
- KLAC has an Altman-Z score of 13.09. This indicates that KLAC is financially healthy and has little risk of bankruptcy at the moment.
- The Altman-Z score of KLAC (13.09) is better than 76.99% of its industry peers.
- KLAC has a debt to FCF ratio of 1.52. This is a very positive value and a sign of high solvency as it would only need 1.52 years to pay back of all of its debts.
- KLAC's Debt to FCF ratio of 1.52 is fine compared to the rest of the industry. KLAC outperforms 70.80% of its industry peers.
- KLAC has a Debt/Equity ratio of 1.18. This is a high value indicating a heavy dependency on external 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.
- 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 | 13.09 |
ROIC/WACC3.53
WACC10.8%
2.3 Liquidity
- A Current Ratio of 2.69 indicates that KLAC has no problem at all paying its short term obligations.
- Looking at the Current ratio, with a value of 2.69, KLAC is in line with its industry, outperforming 47.79% of the companies in the same industry.
- A Quick Ratio of 1.88 indicates that KLAC should not have too much problems paying its short term obligations.
- The Quick ratio of KLAC (1.88) is comparable to the rest of the industry.
| 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
- Looking at the last year, KLAC shows a very strong growth in Revenue. The Revenue has grown by 22.11%.
- KLAC shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 15.93% yearly.
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.
- The Revenue is expected to grow by 8.56% on average over the next years. This is quite good.
EPS Next Y9.93%
EPS Next 2Y15.16%
EPS Next 3Y12.62%
EPS Next 5Y12.51%
Revenue Next Year8.74%
Revenue Next 2Y11.76%
Revenue Next 3Y10.53%
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 43.47, KLAC can be considered very expensive at the moment.
- 69.91% of the companies in the same industry are more expensive than KLAC, based on the Price/Earnings ratio.
- Compared to an average S&P500 Price/Earnings ratio of 27.21, KLAC is valued quite expensively.
- KLAC is valuated quite expensively with a Price/Forward Earnings ratio of 34.24.
- 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's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 24.26.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 43.47 | ||
| Fwd PE | 34.24 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of KLAC indicates a somewhat cheap valuation: KLAC is cheaper than 65.49% of the companies listed 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 | 51.33 | ||
| EV/EBITDA | 34.22 |
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.
- A more expensive valuation may be justified as KLAC's earnings are expected to grow with 12.62% in the coming years.
PEG (NY)4.38
PEG (5Y)1.65
EPS Next 2Y15.16%
EPS Next 3Y12.62%
5. Dividend
5.1 Amount
- KLAC has a yearly dividend return of 0.51%, which is pretty low.
- Compared to an average industry Dividend Yield of 0.50, KLAC pays a bit more dividend than its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.81, KLAC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.51% |
5.2 History
- The dividend of KLAC is nicely growing with an annual growth rate of 15.33%!
- 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.
- KLAC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP22.67%
EPS Next 2Y15.16%
EPS Next 3Y12.62%
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 9.93% in the next year.