171.18 USD
-2.6 (-1.5%)
171 USD
-0.18 (-0.11%)
LRCX gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 113 industry peers in the Semiconductors & Semiconductor Equipment industry. LRCX scores excellent on profitability, but there are some minor concerns on its financial health. LRCX is not overvalued while it is showing excellent growth. This is an interesting combination. These ratings could make LRCX a good candidate for growth investing.
1. Profitability
1.1 Basic Checks
LRCX had positive earnings in the past year.
LRCX had a positive operating cash flow in the past year.
Each year in the past 5 years LRCX has been profitable.
LRCX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 26.53%, LRCX belongs to the top of the industry, outperforming 98.23% of the companies in the same industry.
The Return On Equity of LRCX (57.01%) is better than 96.46% of its industry peers.
LRCX has a Return On Invested Capital of 37.82%. This is amongst the best in the industry. LRCX outperforms 98.23% of its industry peers.
The Average Return On Invested Capital over the past 3 years for LRCX is significantly above the industry average of 10.75%.
The 3 year average ROIC (31.47%) for LRCX 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
LRCX's Profit Margin of 29.66% is amongst the best of the industry. LRCX outperforms 89.38% of its industry peers.
LRCX's Profit Margin has improved in the last couple of years.
LRCX has a Operating Margin of 33.00%. This is amongst the best in the industry. LRCX outperforms 92.04% of its industry peers.
In the last couple of years the Operating Margin of LRCX has grown nicely.
LRCX has a Gross Margin of 49.31%. This is in the better half of the industry: LRCX outperforms 61.06% of its industry peers.
LRCX's Gross Margin has been stable in the last couple of years.
| 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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so LRCX is creating value.
Compared to 1 year ago, LRCX has less shares outstanding
LRCX has less shares outstanding than it did 5 years ago.
LRCX has a better debt/assets ratio than last year.
2.2 Solvency
LRCX has a debt to FCF ratio of 0.81. This is a very positive value and a sign of high solvency as it would only need 0.81 years to pay back of all of its debts.
LRCX's Debt to FCF ratio of 0.81 is fine compared to the rest of the industry. LRCX outperforms 78.76% of its industry peers.
A Debt/Equity ratio of 0.37 indicates that LRCX is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.37, LRCX is not doing good in the industry: 66.37% of the companies in the same industry are doing better.
Although LRCX 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/WACC3.54
WACC10.68%
2.3 Liquidity
A Current Ratio of 2.21 indicates that LRCX has no problem at all paying its short term obligations.
LRCX's Current ratio of 2.21 is on the low side compared to the rest of the industry. LRCX is outperformed by 71.68% of its industry peers.
A Quick Ratio of 1.60 indicates that LRCX should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.60, LRCX is not doing good in the industry: 70.80% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.21 | ||
| Quick Ratio | 1.6 |
3. Growth
3.1 Past
LRCX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 41.65%, which is quite impressive.
LRCX shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 21.02% yearly.
LRCX shows a strong growth in Revenue. In the last year, the Revenue has grown by 25.66%.
The Revenue has been growing by 12.91% on average over the past years. This is quite good.
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
The Earnings Per Share is expected to grow by 13.46% on average over the next years. This is quite good.
The Revenue is expected to grow by 10.31% on average over the next years. This is quite good.
EPS Next Y19.4%
EPS Next 2Y18.27%
EPS Next 3Y15.91%
EPS Next 5Y13.46%
Revenue Next Year16.39%
Revenue Next 2Y14.56%
Revenue Next 3Y11.87%
Revenue Next 5Y10.31%
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.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 37.70, which means the current valuation is very expensive for LRCX.
67.26% of the companies in the same industry are more expensive than LRCX, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 26.51. LRCX is valued slightly more expensive when compared to this.
The Price/Forward Earnings ratio is 29.56, which means the current valuation is very expensive for LRCX.
Based on the Price/Forward Earnings ratio, LRCX is valued a bit cheaper than 61.06% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of LRCX to the average of the S&P500 Index (23.13), we can say LRCX is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.7 | ||
| Fwd PE | 29.56 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of LRCX indicates a somewhat cheap valuation: LRCX is cheaper than 62.83% of the companies listed in the same industry.
LRCX's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. LRCX is cheaper than 75.22% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.74 | ||
| EV/EBITDA | 31.5 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
LRCX has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as LRCX's earnings are expected to grow with 15.91% in the coming years.
PEG (NY)1.94
PEG (5Y)1.79
EPS Next 2Y18.27%
EPS Next 3Y15.91%
5. Dividend
5.1 Amount
With a yearly dividend of 0.59%, LRCX is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 0.56, LRCX pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.00, LRCX's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.59% |
5.2 History
The dividend of LRCX is nicely growing with an annual growth rate of 14.54%!
LRCX has been paying a dividend for at least 10 years, so it has a reliable track record.
LRCX has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)14.54%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
LRCX pays out 20.32% of its income as dividend. This is a sustainable payout ratio.
LRCX's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP20.32%
EPS Next 2Y18.27%
EPS Next 3Y15.91%
171.18
-2.6 (-1.5%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners88.65%
Inst Owner Change-0.89%
Ins Owners0.25%
Ins Owner Change-3.75%
Market Cap215.01B
Revenue(TTM)19.59B
Net Income(TTM)5.81B
Analysts80
Price Target173.27 (1.22%)
Short Float %2.62%
Short Ratio3.02
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.59% |
Yearly Dividend0.89
Dividend Growth(5Y)14.54%
DP20.32%
Div Incr Years10
Div Non Decr Years10
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.44%
Min EPS beat(2)1.09%
Max EPS beat(2)7.79%
EPS beat(4)4
Avg EPS beat(4)3%
Min EPS beat(4)1.09%
Max EPS beat(4)7.79%
EPS beat(8)8
Avg EPS beat(8)3.8%
EPS beat(12)12
Avg EPS beat(12)5.49%
EPS beat(16)14
Avg EPS beat(16)5.37%
Revenue beat(2)1
Avg Revenue beat(2)0.49%
Min Revenue beat(2)-0.24%
Max Revenue beat(2)1.22%
Revenue beat(4)1
Avg Revenue beat(4)0.03%
Min Revenue beat(4)-0.48%
Max Revenue beat(4)1.22%
Revenue beat(8)2
Avg Revenue beat(8)-0.07%
Revenue beat(12)5
Avg Revenue beat(12)0.08%
Revenue beat(16)7
Avg Revenue beat(16)-0.14%
PT rev (1m)5.04%
PT rev (3m)54.05%
EPS NQ rev (1m)0.11%
EPS NQ rev (3m)12.87%
EPS NY rev (1m)-0.04%
EPS NY rev (3m)7.96%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)9%
Revenue NY rev (1m)-0.3%
Revenue NY rev (3m)6.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.7 | ||
| Fwd PE | 29.56 | ||
| P/S | 10.97 | ||
| P/FCF | 38.74 | ||
| P/OCF | 33.68 | ||
| P/B | 21.09 | ||
| P/tB | 25.7 | ||
| EV/EBITDA | 31.5 |
EPS(TTM)4.54
EY2.65%
EPS(NY)5.79
Fwd EY3.38%
FCF(TTM)4.42
FCFY2.58%
OCF(TTM)5.08
OCFY2.97%
SpS15.6
BVpS8.12
TBVpS6.66
PEG (NY)1.94
PEG (5Y)1.79
Graham Number28.79
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 26.53% | ||
| ROE | 57.01% | ||
| ROCE | 42.56% | ||
| ROIC | 37.82% | ||
| ROICexc | 67.6% | ||
| ROICexgc | 86.11% | ||
| OM | 33% | ||
| PM (TTM) | 29.66% | ||
| GM | 49.31% | ||
| FCFM | 28.33% |
ROA(3y)23.18%
ROA(5y)24.18%
ROE(3y)51.37%
ROE(5y)58.46%
ROIC(3y)31.47%
ROIC(5y)32.89%
ROICexc(3y)52.82%
ROICexc(5y)54.36%
ROICexgc(3y)66.54%
ROICexgc(5y)68.82%
ROCE(3y)35.41%
ROCE(5y)37.02%
ROICexgc growth 3Y7.04%
ROICexgc growth 5Y0.35%
ROICexc growth 3Y5.47%
ROICexc growth 5Y4.28%
OM growth 3Y0.81%
OM growth 5Y3.76%
PM growth 3Y2.83%
PM growth 5Y5.33%
GM growth 3Y2.15%
GM growth 5Y1.2%
F-Score8
Asset Turnover0.89
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 0.81 | ||
| Debt/EBITDA | 0.54 | ||
| Cap/Depr | 211.81% | ||
| Cap/Sales | 4.26% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 93.06% | ||
| Profit Quality | 95.52% | ||
| Current Ratio | 2.21 | ||
| Quick Ratio | 1.6 | ||
| Altman-Z | N/A |
F-Score8
WACC10.68%
ROIC/WACC3.54
Cap/Depr(3y)151.1%
Cap/Depr(5y)146.11%
Cap/Sales(3y)3.22%
Cap/Sales(5y)3.04%
Profit Quality(3y)105.3%
Profit Quality(5y)90.85%
High Growth Momentum
Growth
EPS 1Y (TTM)41.65%
EPS 3Y7.72%
EPS 5Y21.02%
EPS Q2Q%46.51%
EPS Next Y19.4%
EPS Next 2Y18.27%
EPS Next 3Y15.91%
EPS Next 5Y13.46%
Revenue 1Y (TTM)25.66%
Revenue growth 3Y2.29%
Revenue growth 5Y12.91%
Sales Q2Q%27.74%
Revenue Next Year16.39%
Revenue Next 2Y14.56%
Revenue Next 3Y11.87%
Revenue Next 5Y10.31%
EBIT growth 1Y41.9%
EBIT growth 3Y3.12%
EBIT growth 5Y17.15%
EBIT Next Year27.78%
EBIT Next 3Y17.33%
EBIT Next 5Y10.27%
FCF growth 1Y23.28%
FCF growth 3Y28.47%
FCF growth 5Y23%
OCF growth 1Y29.21%
OCF growth 3Y25.82%
OCF growth 5Y23.76%
LAM RESEARCH CORP / LRCX FAQ
What is the fundamental rating for LRCX stock?
ChartMill assigns a fundamental rating of 7 / 10 to LRCX.
What is the valuation status of LAM RESEARCH CORP (LRCX) stock?
ChartMill assigns a valuation rating of 4 / 10 to LAM RESEARCH CORP (LRCX). This can be considered as Fairly Valued.
How profitable is LAM RESEARCH CORP (LRCX) stock?
LAM RESEARCH CORP (LRCX) has a profitability rating of 9 / 10.
What is the valuation of LAM RESEARCH CORP based on its PE and PB ratios?
The Price/Earnings (PE) ratio for LAM RESEARCH CORP (LRCX) is 37.7 and the Price/Book (PB) ratio is 21.09.
What is the earnings growth outlook for LAM RESEARCH CORP?
The Earnings per Share (EPS) of LAM RESEARCH CORP (LRCX) is expected to grow by 19.4% in the next year.