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With an impressive market cap of $131.1 billion, Lam Research Corporation (LRCX) is a global leader in providing wafer fabrication equipment and services to the semiconductor industry. It has a strong global presence and expertise in areas such as nanoscale applications, chemistry, plasma and fluidics, and advanced systems engineering. Based in Fremont, California, its customer base includes leading semiconductor memory, foundry, and integrated device manufacturers.
Companies worth $10 billion or more are generally described as “large-cap stocks,” and Lam Research fits right into that category. Its market cap exceeds this threshold, reflecting its substantial size, stability, and influence in the tech sector. The wafer fabrication company enjoys robust demand from the artificial intelligence (AI) boom and high-bandwidth memory for high-performance data centers.
LRCX has climbed to a new 52-week high of $1,015.60 in the last trading session. Moreover, shares of Lam Research have gained 8.5% over the past three months, surpassing the Dow Jones Industrial Average Index’s ($DOWI) marginal dip over the same time frame.
Longer term, LRCX is up 31.7% on a YTD basis, and the stock has soared 64.4% over the past 52 weeks, significantly outpacing DOWI’s 2.8% return in 2024 and 14.4% gains over the past year.
To confirm the bullish price trend, LRCX has been consistently trading above its 200-day moving average over the past year and above the 50-day moving average since early November despite some fluctuations.
Lam Research's sound performance in the past year can be attributed to its innovative wafer fabrication equipment and services, which have helped customers in the semiconductor industry meet the growing demand for smaller and better-performing devices. The company's expertise in areas such as nanoscale applications, chemistry, and advanced systems engineering has enabled it to bridge the demand and supply gap in the chips sector and capitalize on significant opportunities amid the AI transformation.
Shares of Lam Research surged nearly 5% in the subsequent trading session after the company released its better-than-expected Q3 earnings results on April 24. Its revenue of $3.8 billion exceeded estimates by 1.7%, while adjusted EPS rose 3.6% year over year to $7.79, sailing past projections by 7.3%. Also, the wafer giant returned $981 million to shareholders through share repurchases and paid $263 million in dividends.
Furthermore, Lam Research's announcement on May 21 of a $10 billion share repurchase plan and a 10:1 forward stock split fueled a 2.3% rise in its shares. The move aims to return substantial free cash flow to shareholders while enhancing employee stock ownership, boosting investor confidence in the company's strategic financial management.
However, Lam Research has been underperforming its top rival, Applied Materials, Inc. (AMAT), which has surged 67.2% over the past 52 weeks and 44.4% on a YTD basis.
Nonetheless, analysts are cautiously optimistic about the stock's prospects. The stock has a consensus rating of “Moderate Buy” from 27 analysts covering it, and the stock currently trades above its mean price target of $988.76.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
