Oklo stock tumbles as Financial Times scrutinizes valuation
Investing.com - HSBC initiated coverage on Lam Research (NASDAQ:LRCX) with a Hold rating and a $127.00 price target on Tuesday. According to InvestingPro data, the company maintains a "GREAT" financial health score of 3.14, though current analysis suggests the stock is trading above its Fair Value.
The research firm noted that Lam Research is well positioned to benefit from structurally growing demand for wafer fab equipment and serviceable available market expansion associated with various technology transitions. The company’s strong market position is reflected in its impressive 23.7% revenue growth over the last twelve months, with its next earnings report due in 15 days.
HSBC projects a fiscal year 2025-2030 diluted earnings per share compound annual growth rate of 15.7% for Lam Research, acknowledging compounding potential in the shares. For deeper insights into Lam Research’s growth potential and comprehensive analysis, check out the detailed Pro Research Report available on InvestingPro, which covers this and 1,400+ other top US stocks.
The firm cautioned that near-term revenue growth outperformance over wafer fab equipment spending and overall growth are likely to slow, driven by tough comparisons in the foundry and NAND end markets, limiting the scope for valuation re-rating.
HSBC also pointed out that Lam Research shares have rallied sharply, gaining over 30% in September compared to the SOX index’s 13% rise, suggesting that potential upside to consensus estimates may already be priced into the stock.
In other recent news, Lam Research has experienced a variety of analyst updates and market developments. KeyBanc Capital Markets downgraded Lam Research from Overweight to Sector Weight, citing the semiconductor equipment manufacturer’s recent stock price performance exceeding their target. Meanwhile, Stifel maintained its Buy rating on Lam Research, noting improvements in hyperscaler forecasts that could positively impact the company’s position in the memory market. In addition, Lam Research saw gains alongside other hardware and storage companies due to new export rules expected to boost flash pricing. Morgan Stanley downgraded Lam Research from Equalweight to Underweight, projecting a slowdown in growth drivers in China and the NAND memory markets after two strong years. Cantor Fitzgerald raised its price target for Lam Research to $120 from $115, maintaining a Buy rating, and expressed confidence in the company’s competitive positioning based on recent meetings with Lam’s management. These developments highlight the varying perspectives of analysts on Lam Research’s future prospects.
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