Lam Research Gets Boost From Bullish Analysts Post Earnings

Lam Research blows past earnings estimates on its way to a strong fiscal second-quarter beat.
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Shares of semiconductor company Lam Research  (LCRX)  got a boost from positive analyst coverage Thursday following the company’s strong fiscal second-quarter earnings beat.

Lam Research was rising 3.5% to $308.66 in trading Thursday. 

The Fremont, California-based company’s stock price target was raised to a Wall Street high of $400 from $220 a share by analysts at Susquehann,  who said that the quarterly results “exceeded expectations.”

The firm expects Lam Research to raise its 2021 earnings per share target to $30 from its prior estimates between $23 and $25 a share. The firm is especially bullish on Lam Research's wafer fabrication equipment unit.

Analysts at Cowen also see longer-term earnings of $30 a share as a possibility for the company as analyst Krish Sankar raised the firm’s price target to $380 from $346.

Analysts at KeyBanc also see the company’s wafer fabrication equipment unit driving growth. “We expect LCRX to outperform peers as NAND demand resumes, and we believe that NAND producers are entering a multiyear period of capacity expansion,” analyst Weston Twigg wrote.

KeyBanc raised its price target to $385 from $313.

Evercore reaffirmed its outperform rating and $365 price target while stating there "will obviously be much more information flow from management at the company’s analyst day on March 3 in NYC, but we wouldn’t be surprised to hear a three-year target model approaching $30 in EPS.”

Lam Research reported adjusted earnings of $4.01 a share on revenue of $2.58 billion. The company had been expected to report earnings of $3.85 a share on sales of $2.5 billion, based on a FactSet survey of 20 analysts.

In the same period a year ago, the company posted earnings of $3.87 a share on sales of $2.5 billion. It reported a net income of $533.4 million.

The company had offered guidance of $3.60 to $4 a share on Oct. 24. Shares have risen 13.6% since then.

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