LAM RESEARCH CORP (LRCX) Stock Fundamental Analysis
NASDAQ:LRCX - Nasdaq - US5128073062 - Common Stock
Taking everything into account, LRCX scores 7 out of 10 in our fundamental rating. LRCX was compared to 109 industry peers in the Semiconductors & Semiconductor Equipment industry. LRCX scores excellent points on both the profitability and health parts. This is a solid base for a good stock. LRCX is not valued too expensively and it also shows a decent growth rate. These ratings could make LRCX a good candidate for quality investing.
1. Profitability
1.1 Basic Checks
LRCX had positive earnings in the past year.
In the past year LRCX had a positive cash flow from operations.
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
The Return On Assets of LRCX (20.77%) is better than 96.30% of its industry peers.
LRCX has a better Return On Equity (47.89%) than 95.37% of its industry peers.
LRCX has a better Return On Invested Capital (28.27%) than 97.22% of its industry peers.
LRCX had an Average Return On Invested Capital over the past 3 years of 31.96%. This is significantly above the industry average of 11.96%.
| 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 has a better Profit Margin (26.02%) than 86.11% of its industry peers.
In the last couple of years the Profit Margin of LRCX has grown nicely.
LRCX has a Operating Margin of 29.23%. This is amongst the best in the industry. LRCX outperforms 90.74% of its industry peers.
In the last couple of years the Operating Margin of LRCX has grown nicely.
LRCX has a Gross Margin (47.69%) which is comparable to the rest of the 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 5Y2.57%
PM growth 3Y-1.32%
PM growth 5Y2.5%
GM growth 3Y0.77%
GM growth 5Y1.07%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), LRCX is creating value.
Compared to 1 year ago, LRCX has more shares outstanding
LRCX has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, LRCX has an improved debt to assets ratio.
2.2 Solvency
LRCX has an Altman-Z score of 9.51. This indicates that LRCX is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of LRCX (9.51) is better than 75.00% of its industry peers.
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.
LRCX has a better Debt to FCF ratio (1.03) 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 | 9.51 |
ROIC/WACC1.93
WACC14.62%
2.3 Liquidity
LRCX has a Current Ratio of 2.53. This indicates that LRCX is financially healthy and has no problem in meeting its short term obligations.
LRCX has a Current ratio (2.53) which is in line with its industry peers.
A Quick Ratio of 1.74 indicates that LRCX should not have too much problems paying its short term obligations.
LRCX has a worse Quick ratio (1.74) than 62.96% of its industry peers.
| 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.
LRCX shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.80% yearly.
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
Based on estimates for the next years, LRCX will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.52% on average per year.
LRCX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.47% yearly.
EPS Next Y20.78%
EPS Next 2Y19.27%
EPS Next 3Y17.47%
EPS Next 5Y13.52%
Revenue Next Year16.66%
Revenue Next 2Y14.39%
Revenue Next 3Y13%
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
LRCX is valuated quite expensively with a Price/Earnings ratio of 25.39.
Compared to the rest of the industry, the Price/Earnings ratio of LRCX indicates a somewhat cheap valuation: LRCX is cheaper than 73.15% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.29, LRCX is valued at the same level.
Based on the Price/Forward Earnings ratio of 18.91, the valuation of LRCX can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LRCX indicates a somewhat cheap valuation: LRCX is cheaper than 79.63% of the companies listed in the same industry.
LRCX is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.44, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.39 | ||
| Fwd PE | 18.91 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, LRCX is valued a bit cheaper than 70.37% of the companies in the same industry.
85.19% of the companies in the same industry are more expensive than LRCX, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.67 | ||
| EV/EBITDA | 20.78 |
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 17.47% in the coming years.
PEG (NY)1.22
PEG (5Y)1.61
EPS Next 2Y19.27%
EPS Next 3Y17.47%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.16%, LRCX has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.28, LRCX pays a better dividend. On top of this LRCX pays more dividend than 81.48% of the companies listed in the same industry.
With a Dividend Yield of 1.16, LRCX pays less dividend than the S&P500 average, which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.16% |
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 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 2Y19.27%
EPS Next 3Y17.47%
LAM RESEARCH CORP
NASDAQ:LRCX (1/21/2025, 10:21:38 PM)
After market: 82 +0.5 (+0.61%)81.5
+1.2 (+1.49%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners8.9%
Inst Owner Change7.29%
Ins Owners0.02%
Ins Owner Change-0.04%
Market Cap104.86B
Analysts78.38
Price Target95.42 (17.08%)
Short Float %2.66%
Short Ratio3.06
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.16% |
Yearly Dividend1.42
Dividend Growth(5Y)-20.64%
DP25.87%
Div Incr Years10
Div Non Decr Years10
Ex-DateN/A
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)-0.79%
PT rev (3m)-90.8%
EPS NQ rev (1m)-0.21%
EPS NQ rev (3m)-89.83%
EPS NY rev (1m)-0.23%
EPS NY rev (3m)-90.01%
Revenue NQ rev (1m)-0.23%
Revenue NQ rev (3m)1.27%
Revenue NY rev (1m)-0.18%
Revenue NY rev (3m)-0.5%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.39 | ||
| Fwd PE | 18.91 | ||
| P/S | 6.73 | ||
| P/FCF | 21.67 | ||
| P/OCF | 19.9 | ||
| P/B | 12.38 | ||
| P/tB | 15.62 | ||
| EV/EBITDA | 20.78 |
EPS(TTM)3.21
EY3.94%
EPS(NY)4.31
Fwd EY5.29%
FCF(TTM)3.76
FCFY4.61%
OCF(TTM)4.1
OCFY5.03%
SpS12.12
BVpS6.58
TBVpS5.22
PEG (NY)1.22
PEG (5Y)1.61
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)49.28%
ROICexc(5y)51.51%
ROICexgc(3y)61.06%
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 5Y2.57%
PM growth 3Y-1.32%
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 | 9.51 |
F-Score6
WACC14.62%
ROIC/WACC1.93
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 Y20.78%
EPS Next 2Y19.27%
EPS Next 3Y17.47%
EPS Next 5Y13.52%
Revenue 1Y (TTM)-1.55%
Revenue growth 3Y0.63%
Revenue growth 5Y9.08%
Sales Q2Q%19.7%
Revenue Next Year16.66%
Revenue Next 2Y14.39%
Revenue Next 3Y13%
Revenue Next 5Y10.47%
EBIT growth 1Y-1.59%
EBIT growth 3Y-1.18%
EBIT growth 5Y11.88%
EBIT Next Year26.58%
EBIT Next 3Y17.39%
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%