In the latest trading session, Lam Research (LRCX) closed at $443.92, marking a -0.48% move from the previous day. This change was narrower than the S&P 500’s daily loss of 1.11%. Meanwhile, the Dow lost 0.85%, and the Nasdaq, a tech-heavy index, added 0.1%.
Heading into today, shares of the semiconductor equipment maker had lost 3.27% over the past month, outpacing the Computer and Technology sector’s loss of 4.59% and lagging the S&P 500’s loss of 2.19% in that time.
Wall Street will be looking for positivity from Lam Research as it approaches its next earnings report date. The company is expected to report EPS of $9.96, up 16.76% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.08 billion, up 20.25% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $34.49 per share and revenue of $18.13 billion, which would represent changes of +4.14% and +5.22%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Lam Research. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.42% lower within the past month. Lam Research is holding a Zacks Rank of #3 (Hold) right now.
Valuation is also important, so investors should note that Lam Research has a Forward P/E ratio of 12.93 right now. This represents a discount compared to its industry’s average Forward P/E of 14.59.
Also, we should mention that LRCX has a PEG ratio of 1.83. 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. LRCX’s industry had an average PEG ratio of 1.75 as of yesterday’s close.
The Semiconductor Equipment – Wafer Fabrication industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 99, putting it in the top 40% 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.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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