🗜️ LAM RESEARCH CORPORATION: ANALYSIS 🗜️
Lam Research Corporation [LRCX] designs, manufactures, markets, refurbishes, and services semiconductor processing equipment used in the fabrication of integrated circuits. The company offers ALTUS, SABRE, SOLA and VECTOR as their main services for equipment. It also provides single wafer atomic layer and high density plasma chemical vapor deposition products for dielectric film solutions. In addition, the company offers Flex for dielectric etch applications as Flex, Kiyo, Syndion, and Versys. Further, it provides clean products to enhance die yield. Some of LRCX major clients include Samsung, Intel, TSMC, SK Hynix, Micron Technology, Toshiba, GlobalFoundries, STMicroelectronics, Infineon Technologies, and many others.
Its Twelve Trailed Month (TTM 24/04/23) average gross margin was ± 45%, Operative Margin was ± 31% and Net Income Margin was 2.09%. Their average ROIC was ± 45% and normalized EPS was $36.44 USD. If its ROIC is set as price sensitivity, the forward spread could be between $652 USD and $222 USD (based on a PER 12). In addition, if it is set an EBITDA increase at 11%, a Net Debt increase of 10% and a Shares Outstanding of 0%, the forward price could be ± $510 USD (based on a EV/EBITDA 10).
The pros: LRCX has strong margins and ratios, almost zero debt, controlled shares outstanding, pays dividends and it is a supplier to various semiconductor companies. The cons: it is a cyclical company where the fears of the next potential recession might impact.
The closest key bearish level to watch is $400 (PER 11). The closest key bullish level to watch is $600 (PER 16.5).
The best analysis is yours!
Copyright: Joel Padilla 2023
Its Twelve Trailed Month (TTM 24/04/23) average gross margin was ± 45%, Operative Margin was ± 31% and Net Income Margin was 2.09%. Their average ROIC was ± 45% and normalized EPS was $36.44 USD. If its ROIC is set as price sensitivity, the forward spread could be between $652 USD and $222 USD (based on a PER 12). In addition, if it is set an EBITDA increase at 11%, a Net Debt increase of 10% and a Shares Outstanding of 0%, the forward price could be ± $510 USD (based on a EV/EBITDA 10).
The pros: LRCX has strong margins and ratios, almost zero debt, controlled shares outstanding, pays dividends and it is a supplier to various semiconductor companies. The cons: it is a cyclical company where the fears of the next potential recession might impact.
The closest key bearish level to watch is $400 (PER 11). The closest key bullish level to watch is $600 (PER 16.5).
The best analysis is yours!
Copyright: Joel Padilla 2023
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