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In the latest trading session, Lam Research (LRCX) closed at $105.07, marking a +2.06% move from the previous day. The stock exceeded the S&P 500, which registered a gain of 0.21% for the day. On the other hand, the Dow registered a gain of 0.25%, and the technology-centric Nasdaq increased by 0.45%.
Shares of the semiconductor equipment maker have appreciated by 1.18% over the course of the past month, underperforming the Computer and Technology sector’s gain of 4.48%, and the S&P 500’s gain of 3.07%.
The upcoming earnings release of Lam Research will be of great interest to investors. On that day, Lam Research is projected to report earnings of $1.21 per share, which would represent year-over-year growth of 40.7%. At the same time, our most recent consensus estimate is projecting a revenue of $5.22 billion, reflecting a 25.22% rise from the equivalent quarter last year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $4.42 per share and revenue of $19.66 billion. These totals would mark changes of +6.76% and +6.66%, respectively, from last 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. As a result, upbeat changes in estimates indicate analysts’ favorable outlook on the business health and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. 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.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.82% increase. Right now, Lam Research possesses a Zacks Rank of #3 (Hold).
Looking at its valuation, Lam Research is holding a Forward P/E ratio of 23.31. This signifies a discount in comparison to the average Forward P/E of 29.52 for its industry.
One should further note that LRCX currently holds a PEG ratio of 1.32. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. By the end of yesterday’s trading, the Electronics – Semiconductors industry had an average PEG ratio of 1.92.
