- Lam Research (LRCX) is a leading semiconductor equipment supplier, showing strong technical momentum and consistent price appreciation.
- LRCX maintains a 100% “Buy” rating from Barchart.
- Shares have gained 58% over the past year.
- Fundamentals remain robust with projected revenue and earnings growth, a wide economic moat, and strong analyst and investor sentiment.
Today’s Featured Stock
Valued at $151.9 billion, Lam Research (LRCX) is a global supplier of innovative wafer fabrication equipment and services to the semiconductor industry.
Lam’s products and services are designed to help customers build smaller and better performing devices that are used in a variety of electronic products, including mobile phones, personal computers, servers, wearables, automotive vehicles, and data storage devices. Its customer base includes leading semiconductor memory, foundry, and integrated device manufacturers that make products such as non-volatile memory, dynamic random-access memory, and logic devices.
What I’m Watching
I found today’s Chart of the Day by using Barchart’s powerful screening functions to sort for stocks with the highest technical buy signals; superior current momentum in both strength and direction; and a Trend Seeker “buy” signal. I then used Barchart’s Flipcharts feature to review the charts for consistent price appreciation. LRCX checks those boxes. Since the Trend Seeker signaled a buy on Sept. 8, the stock gained 14.56%.
LRCX Price vs. Daily Moving Averages:
Barchart Technical Indicators for Lam Research
Editor’s Note: The technical indicators below are updated live during the session every 20 minutes and can therefore change each day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report. These technical indicators form the Barchart Opinion on a particular stock.
Lam Research hit a new all-time high of $121.26 in intraday trading on Sept. 17.
- Lam has a Weighted Alpha of +79.18.
- LRCX has an 100% “Buy” opinion from Barchart.
- The stock gained 58.18% over the past year.
- LRCX has its Trend Seeker “Buy” signal intact.
- Lam is trading above its 20-, 50-, and 100-day moving averages.
- The stock made 13 new highs and gained 21.77% in the last month.
- Relative Strength Index (RSI) is at 78.75%.
- There’s a technical support level around $119.10.
Don’t Forget the Fundamentals
- $151.9 billion market capitalization.
- 28.79x trailing price-earnings ratio.
- 0.86% dividend yield.
- Revenue is expected to grow 8.46% this year and another 8.90% next year.
- Earnings are projected to increase 7.35% this year and an additional 14.26% next year.
Analyst and Investor Sentiment on Lam Research
I don’t buy stocks because everyone else is buying, but I do realize that if major firms and investors are dumping stock, it’s hard to make money swimming against the tide.
It looks like Wall Street analysts are high on Lam Research.
- The Wall Street analysts tracked by Barchart have issued 20 “Strong Buys,” 2 “Moderate Buys,” and 10 “Hold” opinions on the stock.
- Their price targets are between $80-$135.
- Value Line gives the stock its “Highest” rating with a price target of $132.
- CFRA’s MarketScope Advisor rates it a “Buy” but with a price target of $115.
- Morningstar thinks the stock is 24% overvalued yet comments: “We assign a wide economic moat rating to Lam, underpinned by strong chip manufacturing expertise and steep customer switching costs.”
- 1,775 investors following the stock on Motley Fool think the stock will beat the market while 141 think it won’t.
- 81,100 investors monitor the stock on Seeking Alpha, which rates the stock a “Hold” and comments: “Lam’s advanced technology and strong integration with leading chipmakers provide a wide moat, with recurring revenue from post-sales services adding stability and higher margins, rare for hardware companies.”
The Bottom Line on Lam Research
Lam seems to have it all – growth in both revenue and earnings and a wide following by individual and institutional investors.
I caution that LRCX is volatile and even speculative in the current environment, which means investors should use strict risk management and stop-loss strategies.
Today’s Chart of the Day was written by Jim Van Meerten. Read previous editions of the daily newsletter here.
Additional disclosure: The Barchart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance.
