LAM RESEARCH CORP (LRCX)
US5128073062 - Common Stock
LRCX gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 108 industry peers in the Semiconductors & Semiconductor Equipment industry. LRCX gets an excellent profitability rating and is at the same time showing great financial health properties. LRCX has a correct valuation and a medium growth rate. This makes LRCX very considerable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year LRCX was profitable.
LRCX had a positive operating cash flow in the past year.
LRCX had positive earnings in each of the past 5 years.
Each year in the past 5 years LRCX had a positive operating cash flow.
1.2 Ratios
LRCX's Return On Assets of 20.77% is amongst the best of the industry. LRCX outperforms 97.22% of its industry peers.
LRCX has a better Return On Equity (47.89%) than 96.30% of its industry peers.
Looking at the Return On Invested Capital, with a value of 28.27%, LRCX belongs to the top of the industry, outperforming 98.15% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for LRCX is significantly above the industry average of 11.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 20.77% | ||
| ROE | 47.89% | ||
| ROIC | 28.27% |
ROA(3y)23.74%
ROA(5y)22.26%
ROE(3y)57.71%
ROE(5y)56.3%
ROIC(3y)31.96%
ROIC(5y)29.69%
1.3 Margins
LRCX's Profit Margin of 26.02% is amongst the best of the industry. LRCX outperforms 86.11% of its industry peers.
LRCX's Profit Margin has improved in the last couple of years.
The Operating Margin of LRCX (29.23%) is better than 90.74% of its industry peers.
LRCX's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 47.69%, LRCX perfoms like the industry average, outperforming 57.41% of the companies in the same industry.
In the last couple of years the Gross Margin of LRCX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.23% | ||
| PM (TTM) | 26.02% | ||
| GM | 47.69% |
OM growth 3Y-1.8%
OM growth 5Y2.58%
PM growth 3Y-1.31%
PM growth 5Y2.5%
GM growth 3Y0.77%
GM growth 5Y1.07%
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.
The number of shares outstanding for LRCX has been increased compared to 1 year ago.
LRCX has more shares outstanding than it did 5 years ago.
The debt/assets ratio for LRCX has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 8.92 indicates that LRCX is not in any danger for bankruptcy at the moment.
The Altman-Z score of LRCX (8.92) is better than 73.15% of its industry peers.
The Debt to FCF ratio of LRCX is 1.03, which is an excellent value as it means it would take LRCX, only 1.03 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of LRCX (1.03) is better than 80.56% of its industry peers.
LRCX has a Debt/Equity ratio of 0.53. This is a neutral value indicating LRCX is somewhat dependend on debt financing.
LRCX has a worse Debt to Equity ratio (0.53) than 75.93% of its industry peers.
Even though the debt/equity ratio score it not favorable for LRCX, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 1.03 | ||
| Altman-Z | 8.92 |
ROIC/WACC1.84
WACC15.39%
2.3 Liquidity
A Current Ratio of 2.53 indicates that LRCX has no problem at all paying its short term obligations.
LRCX has a Current ratio of 2.53. This is comparable to the rest of the industry: LRCX outperforms 45.37% of its industry peers.
A Quick Ratio of 1.74 indicates that LRCX should not have too much problems paying its short term obligations.
The Quick ratio of LRCX (1.74) is worse than 61.11% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.53 | ||
| Quick Ratio | 1.74 |
3. Growth
3.1 Past
LRCX shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.98%.
The Earnings Per Share has been growing by 15.80% on average over the past years. This is quite good.
LRCX shows a decrease in Revenue. In the last year, the revenue decreased by -1.55%.
LRCX shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.08% yearly.
EPS 1Y (TTM)4.98%
EPS 3Y3.56%
EPS 5Y15.8%
EPS Q2Q%25.55%
Revenue 1Y (TTM)-1.55%
Revenue growth 3Y0.63%
Revenue growth 5Y9.08%
Sales Q2Q%19.7%
3.2 Future
LRCX is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 13.52% yearly.
Based on estimates for the next years, LRCX will show a quite strong growth in Revenue. The Revenue will grow by 10.47% on average per year.
EPS Next Y21.06%
EPS Next 2Y19.6%
EPS Next 3Y17.71%
EPS Next 5Y13.52%
Revenue Next Year16.87%
Revenue Next 2Y14.6%
Revenue Next 3Y13.15%
Revenue Next 5Y10.47%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last 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 stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 22.36, LRCX is valued on the expensive side.
Based on the Price/Earnings ratio, LRCX is valued a bit cheaper than 75.93% of the companies in the same industry.
When comparing the Price/Earnings ratio of LRCX to the average of the S&P500 Index (27.73), we can say LRCX is valued inline with the index average.
The Price/Forward Earnings ratio is 16.56, which indicates a correct valuation of LRCX.
Based on the Price/Forward Earnings ratio, LRCX is valued cheaper than 81.48% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.83. LRCX is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.36 | ||
| Fwd PE | 16.56 |
4.2 Price Multiples
73.15% of the companies in the same industry are more expensive than LRCX, based on the Enterprise Value to EBITDA ratio.
LRCX's Price/Free Cash Flow ratio is rather cheap when compared to the industry. LRCX is cheaper than 88.89% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.09 | ||
| EV/EBITDA | 18.55 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct 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 17.71% in the coming years.
PEG (NY)1.06
PEG (5Y)1.42
EPS Next 2Y19.6%
EPS Next 3Y17.71%
5. Dividend
5.1 Amount
LRCX has a Yearly Dividend Yield of 1.29%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.31, LRCX pays a better dividend. On top of this LRCX pays more dividend than 81.48% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, LRCX's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.29% |
5.2 History
The dividend of LRCX decreases each year by -20.64%.
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)-20.64%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
25.87% of the earnings are spent on dividend by LRCX. This is a low number and sustainable payout ratio.
DP25.87%
EPS Next 2Y19.6%
EPS Next 3Y17.71%
LAM RESEARCH CORP
NASDAQ:LRCX (12/20/2024, 8:22:52 PM)
After market: 72.15 +0.36 (+0.5%)71.79
+0.58 (+0.81%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners8.9%
Inst Owner Change4.12%
Ins Owners0.02%
Ins Owner Change-1.23%
Market Cap92.37B
Analysts78.86
Price Target96.18 (33.97%)
Short Float %2.62%
Short Ratio2.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.29% |
Dividend Growth(5Y)-20.64%
DP25.87%
Div Incr Years10
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.05%
Min EPS beat(2)4.79%
Max EPS beat(2)5.32%
EPS beat(4)4
Avg EPS beat(4)4.61%
Min EPS beat(4)3.77%
Max EPS beat(4)5.32%
EPS beat(8)8
Avg EPS beat(8)6.73%
EPS beat(12)10
Avg EPS beat(12)6.16%
EPS beat(16)13
Avg EPS beat(16)5.82%
Revenue beat(2)1
Avg Revenue beat(2)0.08%
Min Revenue beat(2)-0.71%
Max Revenue beat(2)0.87%
Revenue beat(4)1
Avg Revenue beat(4)-0.16%
Min Revenue beat(4)-0.71%
Max Revenue beat(4)0.87%
Revenue beat(8)4
Avg Revenue beat(8)0.11%
Revenue beat(12)6
Avg Revenue beat(12)-0.19%
Revenue beat(16)9
Avg Revenue beat(16)0.02%
PT rev (1m)-3.78%
PT rev (3m)-91.06%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-89.81%
EPS NY rev (1m)-0.07%
EPS NY rev (3m)-89.99%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.5%
Revenue NY rev (1m)-0.07%
Revenue NY rev (3m)-0.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.36 | ||
| Fwd PE | 16.56 | ||
| P/S | 5.92 | ||
| P/FCF | 19.09 | ||
| P/OCF | 17.53 | ||
| P/B | 10.9 | ||
| P/tB | 13.76 | ||
| EV/EBITDA | 18.55 |
EPS(TTM)3.21
EY4.47%
EPS(NY)4.33
Fwd EY6.04%
FCF(TTM)3.76
FCFY5.24%
OCF(TTM)4.1
OCFY5.7%
SpS12.12
BVpS6.58
TBVpS5.22
PEG (NY)1.06
PEG (5Y)1.42
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 20.77% | ||
| ROE | 47.89% | ||
| ROCE | 32.11% | ||
| ROIC | 28.27% | ||
| ROICexc | 49.39% | ||
| ROICexgc | 63.04% | ||
| OM | 29.23% | ||
| PM (TTM) | 26.02% | ||
| GM | 47.69% | ||
| FCFM | 31.04% |
ROA(3y)23.74%
ROA(5y)22.26%
ROE(3y)57.71%
ROE(5y)56.3%
ROIC(3y)31.96%
ROIC(5y)29.69%
ROICexc(3y)49.29%
ROICexc(5y)51.51%
ROICexgc(3y)61.07%
ROICexgc(5y)67.9%
ROCE(3y)36.3%
ROCE(5y)33.72%
ROICexcg growth 3Y-10.7%
ROICexcg growth 5Y-8.42%
ROICexc growth 3Y-9.22%
ROICexc growth 5Y-2.97%
OM growth 3Y-1.8%
OM growth 5Y2.58%
PM growth 3Y-1.31%
PM growth 5Y2.5%
GM growth 3Y0.77%
GM growth 5Y1.07%
F-Score6
Asset Turnover0.8
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 1.03 | ||
| Debt/EBITDA | 0.91 | ||
| Cap/Depr | 118.36% | ||
| Cap/Sales | 2.76% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 107.1% | ||
| Profit Quality | 119.29% | ||
| Current Ratio | 2.53 | ||
| Quick Ratio | 1.74 | ||
| Altman-Z | 8.92 |
F-Score6
WACC15.39%
ROIC/WACC1.84
Cap/Depr(3y)140.13%
Cap/Depr(5y)121.94%
Cap/Sales(3y)2.9%
Cap/Sales(5y)2.62%
Profit Quality(3y)90.11%
Profit Quality(5y)87.72%
High Growth Momentum
Growth
EPS 1Y (TTM)4.98%
EPS 3Y3.56%
EPS 5Y15.8%
EPS Q2Q%25.55%
EPS Next Y21.06%
EPS Next 2Y19.6%
EPS Next 3Y17.71%
EPS Next 5Y13.52%
Revenue 1Y (TTM)-1.55%
Revenue growth 3Y0.63%
Revenue growth 5Y9.08%
Sales Q2Q%19.7%
Revenue Next Year16.87%
Revenue Next 2Y14.6%
Revenue Next 3Y13.15%
Revenue Next 5Y10.47%
EBIT growth 1Y-1.59%
EBIT growth 3Y-1.18%
EBIT growth 5Y11.89%
EBIT Next Year27.22%
EBIT Next 3Y17.91%
EBIT Next 5Y12.86%
FCF growth 1Y47.45%
FCF growth 3Y9.52%
FCF growth 5Y8.18%
OCF growth 1Y37.52%
OCF growth 3Y9.04%
OCF growth 5Y7.93%