5 big analyst AI moves: Apple lifted to Buy, AI chip bets reassessed
Investing.com - Cantor Fitzgerald has maintained its Overweight rating and $170 price target on Lam Research (NASDAQ:LRCX), citing strong results despite new export restrictions. The semiconductor equipment maker has demonstrated remarkable momentum, with a 96% return over the past year and revenue growth of 23.7%. According to InvestingPro analysis, the company appears to be trading above its Fair Value, though it maintains strong financial metrics.
The research firm highlighted that Lam faces approximately $200 million in December quarter headwinds related to increased Bureau of Industry and Security (BIS) restrictions, yet still projects calendar year 2025 earnings per share of $4.80, above the consensus estimate of $4.60. InvestingPro data shows the company maintains excellent financial health with an overall score of "GREAT," supported by strong cash flows and moderate debt levels.
Cantor Fitzgerald expects wafer fabrication equipment (WFE) spending to reach approximately $110 billion in 2025 and $125 billion in 2026, with Lam’s tool shipments projected to grow about 40% in 2025, significantly outpacing the broader WFE market growth of roughly 10%.
The firm forecasts Lam’s growth will be driven by approximately 80% expansion in foundry business, 75% growth in 3D NAND, and 10% growth in DRAM, with continued momentum into 2026 despite expectations that domestic China revenue will normalize to 30% of total revenue.
For the longer term, Cantor Fitzgerald estimates Lam’s earnings per share could reach $5.50 in 2026, potentially stretching to $6.00-6.50, with further growth to $7.50 in 2027 and potentially $9.00 by 2028 if wafer fabrication equipment spending reaches $160 billion. With a current P/E ratio of 34.7x and strong growth metrics, investors can access detailed valuation analysis and 18 additional key insights through InvestingPro’s comprehensive research report.
In other recent news, Lam Research has seen a series of positive developments in terms of analyst ratings and financial performance. The company reported a slight revenue beat for the third quarter of 2025 and provided fourth-quarter guidance that exceeded Wall Street expectations, indicating robust performance. Following these results, Needham raised its price target for Lam Research to $160, maintaining a Buy rating due to strong sales in China. Additionally, UBS increased its price target to $165, highlighting the company’s stronger-than-expected guidance and positive outlook for 2026, projecting earnings per share between $5.25 and $5.50. UBS’s own estimate suggests a higher earnings figure of $5.64 per share. Stifel also raised its price target to $160, noting that Lam Research’s fiscal first-quarter results modestly exceeded expectations, with a more moderate revenue decline anticipated for the second quarter. Bernstein made a significant upward adjustment to its price target from $105 to $170, citing growing confidence in the company’s market position and favorable industry trends. These developments reflect a widespread optimistic sentiment among analysts regarding Lam Research’s future performance.
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