1512.78 USD
+12.78 (+0.85%)
1510.01 USD
-2.77 (-0.18%)
Overall KLAC gets a fundamental rating of 7 out of 10. We evaluated KLAC against 113 industry peers in the Semiconductors & Semiconductor Equipment industry. KLAC scores excellent points on both the profitability and health parts. This is a solid base for a good stock. KLAC is growing strongly while it is still valued neutral. This is a good combination! These ratings could make KLAC a good candidate for growth and quality investing.
1. Profitability
1.1 Basic Checks
- In the past year KLAC was profitable.
- KLAC had a positive operating cash flow in the past year.
- In the past 5 years KLAC has always been profitable.
- In the past 5 years KLAC always reported a positive cash flow from operatings.
1.2 Ratios
- Looking at the Return On Assets, with a value of 25.96%, KLAC belongs to the top of the industry, outperforming 97.35% of the companies in the same industry.
- The Return On Equity of KLAC (84.99%) is better than 99.11% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 38.07%, KLAC belongs to the top of the industry, outperforming 99.11% of the companies in the same industry.
- KLAC had an Average Return On Invested Capital over the past 3 years of 34.16%. This is significantly above the industry average of 10.75%.
- The last Return On Invested Capital (38.07%) for KLAC is above the 3 year average (34.16%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 25.96% | ||
| ROE | 84.99% | ||
| ROIC | 38.07% |
ROA(3y)22.41%
ROA(5y)22.77%
ROE(3y)94.85%
ROE(5y)116.64%
ROIC(3y)34.16%
ROIC(5y)32.64%
1.3 Margins
- Looking at the Profit Margin, with a value of 33.83%, KLAC belongs to the top of the industry, outperforming 92.92% of the companies in the same industry.
- KLAC's Profit Margin has improved in the last couple of years.
- KLAC's Operating Margin of 42.86% is amongst the best of the industry. KLAC outperforms 97.35% of its industry peers.
- In the last couple of years the Operating Margin of KLAC has grown nicely.
- With an excellent Gross Margin value of 61.99%, KLAC belongs to the best of the industry, outperforming 86.73% of the companies in the same industry.
- In the last couple of years the Gross Margin of KLAC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 42.86% | ||
| PM (TTM) | 33.83% | ||
| GM | 61.99% |
OM growth 3Y-0.21%
OM growth 5Y6.37%
PM growth 3Y-2.51%
PM growth 5Y9.77%
GM growth 3Y-1.04%
GM growth 5Y1.05%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so KLAC is creating value.
- The number of shares outstanding for KLAC has been reduced compared to 1 year ago.
- KLAC has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, KLAC has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 13.01 indicates that KLAC is not in any danger for bankruptcy at the moment.
- With a decent Altman-Z score value of 13.01, KLAC is doing good in the industry, outperforming 76.11% of the companies in the same industry.
- KLAC has a debt to FCF ratio of 1.52. This is a very positive value and a sign of high solvency as it would only need 1.52 years to pay back of all of its debts.
- The Debt to FCF ratio of KLAC (1.52) is better than 70.80% of its industry peers.
- KLAC has a Debt/Equity ratio of 1.18. This is a high value indicating a heavy dependency on external financing.
- With a Debt to Equity ratio value of 1.18, KLAC is not doing good in the industry: 88.50% of the companies in the same industry are doing better.
- Although KLAC does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.18 | ||
| Debt/FCF | 1.52 | ||
| Altman-Z | 13.01 |
ROIC/WACC3.53
WACC10.8%
2.3 Liquidity
- KLAC has a Current Ratio of 2.69. This indicates that KLAC is financially healthy and has no problem in meeting its short term obligations.
- With a Current ratio value of 2.69, KLAC perfoms like the industry average, outperforming 47.79% of the companies in the same industry.
- KLAC has a Quick Ratio of 1.88. This is a normal value and indicates that KLAC is financially healthy and should not expect problems in meeting its short term obligations.
- KLAC has a Quick ratio (1.88) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.69 | ||
| Quick Ratio | 1.88 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 37.28% over the past year.
- KLAC shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 26.37% yearly.
- KLAC shows a strong growth in Revenue. In the last year, the Revenue has grown by 22.11%.
- KLAC shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 15.93% yearly.
EPS 1Y (TTM)37.28%
EPS 3Y16.32%
EPS 5Y26.37%
EPS Q2Q%20.19%
Revenue 1Y (TTM)22.11%
Revenue growth 3Y9.69%
Revenue growth 5Y15.93%
Sales Q2Q%12.96%
3.2 Future
- Based on estimates for the next years, KLAC will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.51% on average per year.
- The Revenue is expected to grow by 8.56% on average over the next years. This is quite good.
EPS Next Y9.51%
EPS Next 2Y13.36%
EPS Next 3Y11.96%
EPS Next 5Y12.51%
Revenue Next Year8.63%
Revenue Next 2Y11.14%
Revenue Next 3Y9.35%
Revenue Next 5Y8.56%
3.3 Evolution
- Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 43.47, which means the current valuation is very expensive for KLAC.
- Based on the Price/Earnings ratio, KLAC is valued a bit cheaper than 69.91% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 27.21, KLAC is valued quite expensively.
- The Price/Forward Earnings ratio is 35.33, which means the current valuation is very expensive for KLAC.
- 62.83% of the companies in the same industry are more expensive than KLAC, based on the Price/Forward Earnings ratio.
- KLAC's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 24.26.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 43.47 | ||
| Fwd PE | 35.33 |
4.2 Price Multiples
- KLAC's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. KLAC is cheaper than 66.37% of the companies in the same industry.
- 70.80% of the companies in the same industry are more expensive than KLAC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 51.33 | ||
| EV/EBITDA | 33.93 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates KLAC does not grow enough to justify the current Price/Earnings ratio.
- KLAC has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)4.57
PEG (5Y)1.65
EPS Next 2Y13.36%
EPS Next 3Y11.96%
5. Dividend
5.1 Amount
- KLAC has a yearly dividend return of 0.49%, which is pretty low.
- Compared to an average industry Dividend Yield of 0.51, KLAC pays a bit more dividend than its industry peers.
- With a Dividend Yield of 0.49, KLAC pays less dividend than the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.49% |
5.2 History
- On average, the dividend of KLAC grows each year by 15.33%, which is quite nice.
- KLAC has been paying a dividend for at least 10 years, so it has a reliable track record.
- KLAC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)15.33%
Div Incr Years15
Div Non Decr Years19
5.3 Sustainability
- 22.67% of the earnings are spent on dividend by KLAC. This is a low number and sustainable payout ratio.
- The dividend of KLAC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP22.67%
EPS Next 2Y13.36%
EPS Next 3Y11.96%
KLA CORP / KLAC FAQ
What is the ChartMill fundamental rating of KLA CORP (KLAC) stock?
ChartMill assigns a fundamental rating of 7 / 10 to KLAC.
Can you provide the valuation status for KLA CORP?
ChartMill assigns a valuation rating of 4 / 10 to KLA CORP (KLAC). This can be considered as Fairly Valued.
Can you provide the profitability details for KLA CORP?
KLA CORP (KLAC) has a profitability rating of 9 / 10.
What is the financial health of KLA CORP (KLAC) stock?
The financial health rating of KLA CORP (KLAC) is 7 / 10.
Can you provide the expected EPS growth for KLAC stock?
The Earnings per Share (EPS) of KLA CORP (KLAC) is expected to grow by 9.51% in the next year.