Lam Research Corporation Stock Hold Recommendation Reiterated (LRCX)
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- The revenue growth greatly exceeded the industry average of 10.7%. Since the same quarter one year prior, revenues rose by 47.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Although LRCX's debt-to-equity ratio of 0.27 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 3.77, which clearly demonstrates the ability to cover short-term cash needs.
- 45.50% is the gross profit margin for LAM RESEARCH CORP which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, LRCX's net profit margin of 0.74% significantly trails the industry average.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, LAM RESEARCH CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- The share price of LAM RESEARCH CORP has not done very well: it is down 8.84% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
--Written by a member of TheStreet Ratings Staff. It's Official: Action Alerts PLUS beats the S&P 500 with Dividends Reinvested! Cramer and Link were up 16.72% in 2012. Were you? See what they are trading for 14-days FREE
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