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Lam Research (LRCX) Dips More Than Broader Markets: What You Should Know

·3-min read

Lam Research (LRCX) closed the most recent trading day at $664.29, moving -0.75% from the previous trading session. This move lagged the S&P 500's daily loss of 0.14%. At the same time, the Dow lost 0.45%, and the tech-heavy Nasdaq lost 0.02%.

Prior to today's trading, shares of the semiconductor equipment maker had lost 5.19% over the past month. This has was narrower than the Computer and Technology sector's loss of 5.82% and lagged the S&P 500's loss of 0.13% in that time.

Wall Street will be looking for positivity from Lam Research as it approaches its next earnings report date. This is expected to be January 26, 2022. On that day, Lam Research is projected to report earnings of $8.46 per share, which would represent year-over-year growth of 40.3%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.4 billion, up 27.36% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $34.36 per share and revenue of $17.76 billion, which would represent changes of +26.14% and +21.45%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Lam Research. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.19% higher. Lam Research is currently a Zacks Rank #2 (Buy).

Looking at its valuation, Lam Research is holding a Forward P/E ratio of 19.48. This represents a premium compared to its industry's average Forward P/E of 19.01.

Investors should also note that LRCX has a PEG ratio of 1.15 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Semiconductor Equipment - Wafer Fabrication industry currently had an average PEG ratio of 1.15 as of yesterday's close.

The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 56, which puts it in the top 22% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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