Zacks Investment Research Lowers Lam Research (LRCX) to Sell

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Zacks Investment Research cut shares of Lam Research (NASDAQ:LRCX) from a hold rating to a sell rating in a report published on Monday morning.

According to Zacks, “Lam Research’s robust demand for equipment and memory segment, strength in logic & foundry along with increased adoption rates of 3D NAND technology bodes well for Lam Research. Further, the company’s popular etch and deposition technologies are suitable for the ongoing vertical scaling, multi-patterning, advanced packaging and advanced transistor architectures. This will help it rebound going forward. However, the company's top-line results continue to be impacted by weak PC demand. Also, oversupply and overcapacity of memory chips could impact Lam Research’s growth and sales figures as yields and output seem to be improving.”

Several other research firms have also recently issued reports on LRCX. BidaskClub raised Lam Research from a buy rating to a strong-buy rating in a research note on Tuesday, March 13th. Vetr cut Lam Research from a strong-buy rating to a buy rating and set a $240.39 target price on the stock. in a research note on Monday, March 12th. FBN Securities began coverage on Lam Research in a research note on Thursday, March 15th. They set an outperform rating and a $300.00 target price on the stock. Bank of America began coverage on Lam Research in a research note on Wednesday, March 21st. They set a buy rating and a $305.00 target price on the stock. Finally, Mizuho began coverage on Lam Research in a research note on Tuesday, March 27th. They set a buy rating and a $250.00 target price on the stock. Two research analysts have rated the stock with a sell rating, two have issued a hold rating, twenty-one have assigned a buy rating and one has issued a strong buy rating to the company’s stock. The stock currently has an average rating of Buy and a consensus target price of $254.66.

Shares of Lam Research stock opened at $169.80 on Monday. The company has a debt-to-equity ratio of 0.26, a quick ratio of 2.21 and a current ratio of 2.64. The company has a market capitalization of $28.53 billion, a price-to-earnings ratio of 17.01, a P/E/G ratio of 0.57 and a beta of 1.43. Lam Research has a one year low of $139.24 and a one year high of $234.88.

Lam Research (NASDAQ:LRCX) last posted its earnings results on Tuesday, April 17th. The semiconductor company reported $4.79 earnings per share (EPS) for the quarter, beating the Thomson Reuters’ consensus estimate of $4.38 by $0.41. Lam Research had a return on equity of 41.13% and a net margin of 18.32%. The firm had revenue of $2.89 billion for the quarter, compared to analysts’ expectations of $2.85 billion. During the same period in the previous year, the firm earned $3.10 earnings per share. The business’s revenue was up 34.3% compared to the same quarter last year. equities analysts expect that Lam Research will post 17.5 EPS for the current fiscal year.

Lam Research announced that its board has approved a stock buyback program on Tuesday, March 6th that authorizes the company to repurchase $2.00 billion in outstanding shares. This repurchase authorization authorizes the semiconductor company to repurchase shares of its stock through open market purchases. Shares repurchase programs are typically a sign that the company’s management believes its stock is undervalued.

The company also recently declared a quarterly dividend, which was paid on Wednesday, June 27th. Investors of record on Wednesday, June 6th were given a dividend of $1.10 per share. The ex-dividend date of this dividend was Tuesday, June 5th. This is a positive change from Lam Research’s previous quarterly dividend of $0.50. This represents a $4.40 annualized dividend and a dividend yield of 2.59%. Lam Research’s payout ratio is currently 44.09%.

In other Lam Research news, insider Timothy Archer sold 5,000 shares of the business’s stock in a transaction on Tuesday, May 1st. The stock was sold at an average price of $190.00, for a total value of $950,000.00. The transaction was disclosed in a filing with the SEC, which is available through the SEC website. Also, CEO Martin B. Anstice sold 25,122 shares of the business’s stock in a transaction on Tuesday, May 22nd. The stock was sold at an average price of $203.83, for a total value of $5,120,617.26. The disclosure for this sale can be found here. Insiders sold 41,330 shares of company stock worth $8,322,796 over the last three months. Corporate insiders own 0.41% of the company’s stock.

A number of institutional investors have recently added to or reduced their stakes in LRCX. PointState Capital LP bought a new stake in Lam Research in the first quarter worth $377,895,000. Swedbank bought a new stake in Lam Research in the first quarter worth $222,018,000. Artisan Partners Limited Partnership bought a new stake in Lam Research in the first quarter worth $144,678,000. Millennium Management LLC lifted its holdings in shares of Lam Research by 80.5% during the first quarter. Millennium Management LLC now owns 1,158,373 shares of the semiconductor company’s stock valued at $235,335,000 after purchasing an additional 516,453 shares in the last quarter. Finally, Summit Trail Advisors LLC lifted its holdings in shares of Lam Research by 17,919.5% during the first quarter. Summit Trail Advisors LLC now owns 398,771 shares of the semiconductor company’s stock valued at $399,000 after purchasing an additional 396,558 shares in the last quarter. 88.31% of the stock is currently owned by institutional investors and hedge funds.

Lam Research Company Profile

Lam Research Corporation designs, manufactures, markets, refurbishes, and services semiconductor processing equipment used in the fabrication of integrated circuits worldwide. The company offers thin film deposition products, including SABRE electrochemical deposition products for copper damascene manufacturing; ALTUS systems to deposit conformal atomic layer films for tungsten metallization applications; VECTOR plasma-enhanced chemical vapor deposition (CVD) and atomic layer deposition systems to deposit oxides, nitrides, and carbides for hardmasks, multiple patterning films, anti-reflective layers, multi-layer stack films, and diffusion barriers; and Striker atomic layer deposition systems that deliver conformal dielectric films for spacer-based patterning and liner applications in various advanced memory and logic structures.

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