Fact based stock research
Lam Research (NasdaqGS:LRCX)

US5128071082

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Lam Research stock research in summary

lamresearch.com

ANALYSIS: With an Obermatt Combined Rank of 54 (better than 54% compared with investment alternatives), Lam Research (Semiconductor Equipment, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Lam Research are a good value (attractively priced) with a consolidated Value Rank of 73 (better than 73% of alternatives), show above-average growth (Growth Rank of 67) but are riskily financed (Safety Rank of 22), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 54, is a buy recommendation based on Lam Research's financial characteristics. As the company Lam Research's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 73) and above-average growth (Obermatt Growth Rank of 67), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 22) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	73
Growth Rank	67
Safety Rank	22
Combined Rank	54

Country	USA
Industry	Semiconductor Equipment
Index	Dividends USA, Employee Focus US, Diversity USA, Human Rights, Recycling, SDG 10, SDG 13, SDG 3, SDG 4, SDG 8, NASDAQ 100, NASDAQ, S&P 500
Size class	XX-Large

This stock has achievements: Top 10 Stock.

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Lam Research

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	60	79	65	73
GROWTH
GROWTH	80	3	92	67
SAFETY
SAFETY	69	42	23	22
SENTIMENT
SENTIMENT	n/a	3	45	^new
360° VIEW
360° VIEW	n/a	5	59	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 29-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Lam Research is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	60	79	65	73
GROWTH
GROWTH	80	3	92	67
SAFETY
SAFETY	69	42	23	22
COMBINED
COMBINED	89	32	67	54

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Lam Research the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 73 (better than 73% compared with alternatives), Lam Research shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Lam Research. Price-to-Profit (also referred to as price-earnings, P/E) is 67 which means that the stock price compared with what market professionals expect for future profits is lower than for 67% of comparable companies, indicating a good value concerning Lam Research's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 14, which means that the stock price is lower as regards to invested capital than for 14% of comparable investments. On the other hand, Price-to-Sales is less favorable than 62% of alternatives (only 38% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 13% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 73, is a buy recommendation based on Lam Research's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	50	54	30	38
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	82	64	56	67
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	8	12	11	14
DIVIDEND YIELD
DIVIDEND YIELD	86	91	91	87
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	60	79	65	73

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Lam Research; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 67 (better than 67% compared with alternatives), Lam Research shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with all four indicators above average for Lam Research. Sales Growth has a value of 52, which means that, currently, professionals expect the company to grow more than 52% of its competitors. The same is valid for Profit Growth with a value of 65 and for Capital Growth with 57. In addition, Stock Returns had an above-average rank value of 59, which means they have been higher than 59% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 67, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Lam Research exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	65	9	78	52
PROFIT GROWTH
PROFIT GROWTH	88	23	48	65
CAPITAL GROWTH
CAPITAL GROWTH	n/a	32	81	57
STOCK RETURNS
STOCK RETURNS	80	59	91	59
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	80	3	92	67

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Lam Research.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 22 (better than 22% compared with alternatives), the company Lam Research has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Lam Research is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Lam Research. Liquidity is at 72, meaning the company generates more profit to service its debt than 72% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 33, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 67% of its competitors. Leverage is also high at a rank of 22, which means that the company has an above-average debt-to-equity ratio. It has more debt than 78% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 22 (worse than 78% compared with alternatives), Lam Research has a financing structure that is significantly riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	38	16	21	22
REFINANCING
REFINANCING	60	41	30	33
LIQUIDITY
LIQUIDITY	85	75	67	72
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	69	42	23	22

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Lam Research and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	30	34	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	49	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	39	79	^new
MARKET PULSE
MARKET PULSE	n/a	10	46	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	3	45	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Lam Research.
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