Lam Research Corporation
Find Ratings ReportsLAM RESEARCH CORP's gross profit margin for the second quarter of its fiscal year 2024 has increased when compared to the same period a year ago. Sales and net income fell significantly, underperforming compared to the average company in its subsector. LAM RESEARCH CORP has strong liquidity. Currently, the Quick Ratio is 1.95 which shows the ability to cover short-term cash needs. The company managed to increase its liquidity from the same period a year ago, despite already having strong liquidity to begin with. This would indicate improved cash flow.
During the same period, stockholders' equity ("net worth") has remained unchanged from the same quarter last year. The key liquidity measurements indicate that the company is unlikely to face financial difficulties in the near future.
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Income Statement | Q2 FY24 | Q2 FY23 |
---|---|---|
Net Sales ($mil) | 3758.26 | 5277.57 |
EBITDA ($mil) | 1189.7 | 1765.58 |
EBIT ($mil) | 1098.76 | 1680.16 |
Net Income ($mil) | 954.27 | 1468.51 |
Balance Sheet | Q2 FY24 | Q2 FY23 |
---|---|---|
Cash & Equiv. ($mil) | 5638.01 | 4587.85 |
Total Assets ($mil) | 18783.85 | 19206.38 |
Total Debt ($mil) | 4983.78 | 5003.28 |
Equity ($mil) | 8222.48 | 8304.64 |
Profitability | Q2 FY24 | Q2 FY23 |
---|---|---|
Gross Profit Margin | 49.75 | 46.62 |
EBITDA Margin | 31.65 | 33.45 |
Operating Margin | 29.24 | 31.84 |
Sales Turnover | 0.76 | 0.99 |
Return on Assets | 18.41 | 26.68 |
Return on Equity | 42.06 | 61.71 |
Debt | Q2 FY24 | Q2 FY23 |
---|---|---|
Current Ratio | 3.06 | 3.02 |
Debt/Capital | 0.38 | 0.38 |
Interest Expense | 46.31 | 46.66 |
Interest Coverage | 23.72 | 36.01 |
Share Data | Q2 FY24 | Q2 FY23 |
---|---|---|
Shares outstanding (mil) | 131.28 | 135.4 |
Div / share | 2.0 | 1.73 |
EPS | 7.22 | 10.77 |
Book value / share | 62.63 | 61.33 |
Institutional Own % | n/a | n/a |
Avg Daily Volume | 1057653.0 | 1020567.0 |
BUY. LAM RESEARCH CORP's P/E ratio indicates a premium compared to an average of 34.89 for the Machinery Manufacturing subsector and a premium compared to the S&P 500 average of 27.95. For additional comparison, its price-to-book ratio of 14.78 indicates a significant premium versus the S&P 500 average of 4.68 and a discount versus the subsector average of 15.81. The current price-to-sales ratio is well above the S&P 500 average and above the subsector average, indicating a premium. The valuation analysis reveals that, LAM RESEARCH CORP seems to be trading at a premium to investment alternatives.
Price/Earnings |
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Price/Cash Flow |
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LRCX 35.80 | Peers 34.89 | LRCX 23.16 | Peers 35.56 | |||||||||||||||||||||
Average. An average P/E ratio can signify an subsector neutral price for a stock and an average growth expectation. LRCX is trading at a valuation on par with its peers. |
Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. LRCX is trading at a significant discount to its peers. |
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Price/Projected Earnings |
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Price to Earnings/Growth |
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LRCX 26.10 | Peers 25.65 | LRCX NM | Peers 5.15 | |||||||||||||||||||||
Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations. LRCX is trading at a premium to its peers. |
Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. LRCX's negative PEG ratio makes this valuation measure meaningless. |
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Price/Book |
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Earnings Growth |
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LRCX 14.78 | Peers 15.81 | LRCX -30.49 | Peers 20.44 | |||||||||||||||||||||
Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. LRCX is trading at a valuation on par with its peers. |
Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. However, LRCX is expected to significantly trail its peers on the basis of its earnings growth rate. |
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Price/Sales |
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Sales Growth |
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LRCX 8.49 | Peers 8.34 | LRCX -24.84 | Peers 14.92 | |||||||||||||||||||||
Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. LRCX is trading at a valuation on par with its subsector on this measurement. |
Lower. A sales growth rate that trails the subsector implies that a company is losing market share. LRCX significantly trails its peers on the basis of sales growth. |
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