LAM RESEARCH CORP (LRCX) Stock Fundamental Analysis
USA - NASDAQ:LRCX - US5128073062 - Common Stock
131.93 USD
-0.27 (-0.2%)
132.2 USD
+0.27 (+0.2%)
LRCX gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 112 industry peers in the Semiconductors & Semiconductor Equipment industry. While LRCX belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. LRCX is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year LRCX was profitable.
LRCX had a positive operating cash flow in the past year.
Each year in the past 5 years LRCX has been profitable.
LRCX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 25.10%, LRCX belongs to the top of the industry, outperforming 96.43% of the companies in the same industry.
LRCX has a better Return On Equity (54.33%) than 95.54% of its industry peers.
The Return On Invested Capital of LRCX (35.49%) is better than 98.21% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for LRCX is significantly above the industry average of 10.87%.
The last Return On Invested Capital (35.49%) for LRCX is above the 3 year average (31.47%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 25.1% | ||
| ROE | 54.33% | ||
| ROIC | 35.49% |
ROA(3y)23.18%
ROA(5y)24.18%
ROE(3y)51.37%
ROE(5y)58.46%
ROIC(3y)31.47%
ROIC(5y)32.89%
1.3 Margins
LRCX has a better Profit Margin (29.06%) than 89.29% of its industry peers.
In the last couple of years the Profit Margin of LRCX has grown nicely.
LRCX has a better Operating Margin (32.01%) than 91.96% of its industry peers.
In the last couple of years the Operating Margin of LRCX has grown nicely.
With a decent Gross Margin value of 48.70%, LRCX is doing good in the industry, outperforming 60.71% of the companies in the same industry.
In the last couple of years the Gross Margin of LRCX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 32.01% | ||
| PM (TTM) | 29.06% | ||
| GM | 48.71% |
OM growth 3Y0.81%
OM growth 5Y3.76%
PM growth 3Y2.83%
PM growth 5Y5.33%
GM growth 3Y2.15%
GM growth 5Y1.2%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), LRCX is creating value.
Compared to 1 year ago, LRCX has less shares outstanding
The number of shares outstanding for LRCX has been reduced compared to 5 years ago.
LRCX has a better debt/assets ratio than last year.
2.2 Solvency
LRCX has a debt to FCF ratio of 0.83. This is a very positive value and a sign of high solvency as it would only need 0.83 years to pay back of all of its debts.
LRCX has a Debt to FCF ratio of 0.83. This is in the better half of the industry: LRCX outperforms 76.79% of its industry peers.
LRCX has a Debt/Equity ratio of 0.38. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.38, LRCX is doing worse than 66.96% of the companies in the same industry.
Even though the debt/equity ratio score it not favorable for LRCX, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 0.83 | ||
| Altman-Z | N/A |
ROIC/WACC3.08
WACC11.51%
2.3 Liquidity
LRCX has a Current Ratio of 2.21. This indicates that LRCX is financially healthy and has no problem in meeting its short term obligations.
LRCX has a worse Current ratio (2.21) than 70.54% of its industry peers.
LRCX has a Quick Ratio of 1.55. This is a normal value and indicates that LRCX is financially healthy and should not expect problems in meeting its short term obligations.
LRCX has a Quick ratio of 1.55. This is in the lower half of the industry: LRCX underperforms 69.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.21 | ||
| Quick Ratio | 1.55 |
3. Growth
3.1 Past
LRCX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 36.63%, which is quite impressive.
The Earnings Per Share has been growing by 21.02% on average over the past years. This is a very strong growth
Looking at the last year, LRCX shows a very strong growth in Revenue. The Revenue has grown by 23.68%.
Measured over the past years, LRCX shows a quite strong growth in Revenue. The Revenue has been growing by 12.91% on average per year.
EPS 1Y (TTM)36.63%
EPS 3Y7.72%
EPS 5Y21.02%
EPS Q2Q%63.39%
Revenue 1Y (TTM)23.68%
Revenue growth 3Y2.29%
Revenue growth 5Y12.91%
Sales Q2Q%33.58%
3.2 Future
Based on estimates for the next years, LRCX will show a quite strong growth in Earnings Per Share. The EPS will grow by 16.67% on average per year.
Based on estimates for the next years, LRCX will show a small growth in Revenue. The Revenue will grow by 7.88% on average per year.
EPS Next Y10.07%
EPS Next 2Y12.01%
EPS Next 3Y12.4%
EPS Next 5Y16.67%
Revenue Next Year9.5%
Revenue Next 2Y9.47%
Revenue Next 3Y9%
Revenue Next 5Y7.88%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
LRCX is valuated quite expensively with a Price/Earnings ratio of 31.87.
Compared to the rest of the industry, the Price/Earnings ratio of LRCX indicates a somewhat cheap valuation: LRCX is cheaper than 73.21% of the companies listed in the same industry.
LRCX is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.41, which is the current average of the S&P500 Index.
LRCX is valuated quite expensively with a Price/Forward Earnings ratio of 28.95.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LRCX is on the same level as its industry peers.
LRCX is valuated rather expensively when we compare the Price/Forward Earnings ratio to 22.87, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.87 | ||
| Fwd PE | 28.95 |
4.2 Price Multiples
LRCX's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. LRCX is cheaper than 66.96% of the companies in the same industry.
LRCX's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. LRCX is cheaper than 76.79% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.92 | ||
| EV/EBITDA | 26.31 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
LRCX has an outstanding profitability rating, which may justify a higher PE ratio.
LRCX's earnings are expected to grow with 12.40% in the coming years. This may justify a more expensive valuation.
PEG (NY)3.16
PEG (5Y)1.52
EPS Next 2Y12.01%
EPS Next 3Y12.4%
5. Dividend
5.1 Amount
LRCX has a yearly dividend return of 0.82%, which is pretty low.
Compared to an average industry Dividend Yield of 2.23, LRCX pays a better dividend. On top of this LRCX pays more dividend than 81.25% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.38, LRCX's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.82% |
5.2 History
On average, the dividend of LRCX grows each year by 14.54%, which is quite nice.
LRCX has been paying a dividend for at least 10 years, so it has a reliable track record.
LRCX has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)14.54%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
21.45% of the earnings are spent on dividend by LRCX. This is a low number and sustainable payout ratio.
LRCX's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP21.45%
EPS Next 2Y12.01%
EPS Next 3Y12.4%
131.93
-0.27 (-0.2%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners88.42%
Inst Owner Change0.61%
Ins Owners0.26%
Ins Owner Change-0.4%
Market Cap166.97B
Analysts80
Price Target112.47 (-14.75%)
Short Float %2.51%
Short Ratio2.86
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.82% |
Yearly Dividend0.89
Dividend Growth(5Y)14.54%
DP21.45%
Div Incr Years10
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.6%
Min EPS beat(2)1.42%
Max EPS beat(2)7.79%
EPS beat(4)4
Avg EPS beat(4)3.92%
Min EPS beat(4)1.42%
Max EPS beat(4)7.79%
EPS beat(8)8
Avg EPS beat(8)4.87%
EPS beat(12)12
Avg EPS beat(12)5.99%
EPS beat(16)13
Avg EPS beat(16)5.29%
Revenue beat(2)1
Avg Revenue beat(2)0.41%
Min Revenue beat(2)-0.4%
Max Revenue beat(2)1.22%
Revenue beat(4)2
Avg Revenue beat(4)0.3%
Min Revenue beat(4)-0.48%
Max Revenue beat(4)1.22%
Revenue beat(8)3
Avg Revenue beat(8)-0.04%
Revenue beat(12)6
Avg Revenue beat(12)0.21%
Revenue beat(16)7
Avg Revenue beat(16)-0.27%
PT rev (1m)1.39%
PT rev (3m)18.37%
EPS NQ rev (1m)0.04%
EPS NQ rev (3m)23.7%
EPS NY rev (1m)0%
EPS NY rev (3m)11.22%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)13.19%
Revenue NY rev (1m)0.42%
Revenue NY rev (3m)6.99%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.87 | ||
| Fwd PE | 28.95 | ||
| P/S | 9.06 | ||
| P/FCF | 30.92 | ||
| P/OCF | 27.11 | ||
| P/B | 16.93 | ||
| P/tB | 20.73 | ||
| EV/EBITDA | 26.31 |
EPS(TTM)4.14
EY3.14%
EPS(NY)4.56
Fwd EY3.45%
FCF(TTM)4.27
FCFY3.23%
OCF(TTM)4.87
OCFY3.69%
SpS14.57
BVpS7.79
TBVpS6.36
PEG (NY)3.16
PEG (5Y)1.52
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 25.1% | ||
| ROE | 54.33% | ||
| ROCE | 39.93% | ||
| ROIC | 35.49% | ||
| ROICexc | 62.53% | ||
| ROICexgc | 79.72% | ||
| OM | 32.01% | ||
| PM (TTM) | 29.06% | ||
| GM | 48.71% | ||
| FCFM | 29.29% |
ROA(3y)23.18%
ROA(5y)24.18%
ROE(3y)51.37%
ROE(5y)58.46%
ROIC(3y)31.47%
ROIC(5y)32.89%
ROICexc(3y)52.82%
ROICexc(5y)54.36%
ROICexgc(3y)66.54%
ROICexgc(5y)68.82%
ROCE(3y)35.41%
ROCE(5y)37.02%
ROICexcg growth 3Y7.04%
ROICexcg growth 5Y0.35%
ROICexc growth 3Y5.47%
ROICexc growth 5Y4.28%
OM growth 3Y0.81%
OM growth 5Y3.76%
PM growth 3Y2.83%
PM growth 5Y5.33%
GM growth 3Y2.15%
GM growth 5Y1.2%
F-Score8
Asset Turnover0.86
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 0.83 | ||
| Debt/EBITDA | 0.59 | ||
| Cap/Depr | 196.54% | ||
| Cap/Sales | 4.12% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 97.97% | ||
| Profit Quality | 100.79% | ||
| Current Ratio | 2.21 | ||
| Quick Ratio | 1.55 | ||
| Altman-Z | N/A |
F-Score8
WACC11.51%
ROIC/WACC3.08
Cap/Depr(3y)151.1%
Cap/Depr(5y)146.11%
Cap/Sales(3y)3.22%
Cap/Sales(5y)3.04%
Profit Quality(3y)105.22%
Profit Quality(5y)90.8%
High Growth Momentum
Growth
EPS 1Y (TTM)36.63%
EPS 3Y7.72%
EPS 5Y21.02%
EPS Q2Q%63.39%
EPS Next Y10.07%
EPS Next 2Y12.01%
EPS Next 3Y12.4%
EPS Next 5Y16.67%
Revenue 1Y (TTM)23.68%
Revenue growth 3Y2.29%
Revenue growth 5Y12.91%
Sales Q2Q%33.58%
Revenue Next Year9.5%
Revenue Next 2Y9.47%
Revenue Next 3Y9%
Revenue Next 5Y7.88%
EBIT growth 1Y36.42%
EBIT growth 3Y3.12%
EBIT growth 5Y17.15%
EBIT Next Year13.81%
EBIT Next 3Y12.52%
EBIT Next 5Y9.68%
FCF growth 1Y26.9%
FCF growth 3Y28.36%
FCF growth 5Y22.94%
OCF growth 1Y32.4%
OCF growth 3Y25.72%
OCF growth 5Y23.7%