LAM RESEARCH CORP (LRCX)
US5128073062 - Common Stock
Overall LRCX gets a fundamental rating of 7 out of 10. We evaluated LRCX against 108 industry peers in the Semiconductors & Semiconductor Equipment industry. While LRCX has a great profitability rating, there are some minor concerns on its financial health. LRCX is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year LRCX was profitable.
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 20.77%, LRCX belongs to the top of the industry, outperforming 97.22% of the companies in the same industry.
LRCX's Return On Equity of 47.89% is amongst the best of the industry. LRCX outperforms 96.30% of its industry peers.
With an excellent Return On Invested Capital value of 28.27%, LRCX belongs to the best of the industry, outperforming 98.15% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for LRCX is significantly above the industry average of 11.05%.
| 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.
In the last couple of years the Profit Margin of LRCX has grown nicely.
LRCX's Operating Margin of 29.23% is amongst the best of the industry. LRCX outperforms 90.74% of its industry peers.
LRCX's Operating Margin has improved in the last couple of years.
LRCX has a Gross Margin of 47.69%. This is comparable to the rest of the industry: LRCX outperforms 57.41% of its industry peers.
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.
LRCX has a better debt/assets ratio than last year.
2.2 Solvency
LRCX has an Altman-Z score of 9.01. This indicates that LRCX is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 9.01, LRCX is in the better half of the industry, outperforming 76.85% of the companies in the same industry.
LRCX has a debt to FCF ratio of 1.03. This is a very positive value and a sign of high solvency as it would only need 1.03 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 1.03, LRCX is doing good in the industry, outperforming 79.63% of the companies in the same industry.
A Debt/Equity ratio of 0.53 indicates that LRCX is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.53, LRCX is doing worse than 75.93% of the companies in the same industry.
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 | 0.53 | ||
| Debt/FCF | 1.03 | ||
| Altman-Z | 9.01 |
ROIC/WACC1.93
WACC14.63%
2.3 Liquidity
A Current Ratio of 2.53 indicates that LRCX has no problem at all paying its short term obligations.
With a Current ratio value of 2.53, LRCX perfoms like the industry average, outperforming 44.44% of the companies in the same industry.
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 comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.53 | ||
| Quick Ratio | 1.74 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 4.98% over the past year.
Measured over the past years, LRCX shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.80% on average per year.
LRCX shows a decrease in Revenue. In the last year, the revenue decreased by -1.55%.
Measured over the past years, LRCX shows a quite strong growth in Revenue. The Revenue has been growing by 9.08% on average per year.
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
The Earnings Per Share is expected to grow by 108.00% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 11.43% on average over the next years. This is quite good.
EPS Next Y21.15%
EPS Next 2Y19.91%
EPS Next 3Y17.71%
EPS Next 5Y108%
Revenue Next Year16.95%
Revenue Next 2Y14.79%
Revenue Next 3Y13.15%
Revenue Next 5Y11.43%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 22.78 indicates a rather expensive valuation of LRCX.
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 (28.96), we can say LRCX is valued slightly cheaper.
The Price/Forward Earnings ratio is 16.79, which indicates a correct valuation of LRCX.
Based on the Price/Forward Earnings ratio, LRCX is valued a bit cheaper than the industry average as 79.63% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 23.82. LRCX is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.78 | ||
| Fwd PE | 16.79 |
4.2 Price Multiples
74.07% 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 86.11% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.44 | ||
| EV/EBITDA | 18.9 |
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)1.08
PEG (5Y)1.44
EPS Next 2Y19.91%
EPS Next 3Y17.71%
5. Dividend
5.1 Amount
LRCX has a Yearly Dividend Yield of 1.23%. Purely for dividend investing, there may be better candidates out there.
LRCX's Dividend Yield is rather good when compared to the industry average which is at 2.37. LRCX pays more dividend than 80.56% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.23, LRCX's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.23% |
5.2 History
The dividend of LRCX decreases each year by -20.64%.
LRCX has paid a dividend for at least 10 years, which is a reliable track record.
LRCX has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)-20.64%
Div Incr Years9
Div Non Decr Years9
5.3 Sustainability
LRCX pays out 25.87% of its income as dividend. This is a sustainable payout ratio.
DP25.87%
EPS Next 2Y19.91%
EPS Next 3Y17.71%
LAM RESEARCH CORP
NASDAQ:LRCX (11/21/2024, 8:00:00 PM)
Premarket: 72.84 -0.29 (-0.4%)73.13
+3.08 (+4.4%)
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 Cap94.09B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.23% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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Revenue beat(2)
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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)
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Revenue NY rev (1m)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.78 | ||
| Fwd PE | 16.79 | ||
| 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)1.08
PEG (5Y)1.44
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 20.77% | ||
| ROE | 47.89% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 29.23% | ||
| PM (TTM) | 26.02% | ||
| GM | 47.69% | ||
| 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 Turnover0.8
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 2.53 | ||
| Quick Ratio | 1.74 | ||
| 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)
High Growth Momentum
Growth
EPS 1Y (TTM)4.98%
EPS 3Y3.56%
EPS 5Y
EPS Q2Q%
EPS Next Y21.15%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-1.55%
Revenue growth 3Y0.63%
Revenue growth 5Y
Sales 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