Lam Research Corporation Stock Upgraded (LRCX)
NEW YORK (
)
(Nasdaq:
) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- Despite currently having a low debt-to-equity ratio of 0.31, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 4.52 is very high and demonstrates very strong liquidity.
- 43.90% is the gross profit margin for LAM RESEARCH CORP which we consider to be strong. Regardless of LRCX's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, LRCX's net profit margin of 5.70% is significantly lower than the same period one year prior.
- The revenue fell significantly faster than the industry average of 25.0%. Since the same quarter one year prior, revenues fell by 32.9%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- LAM RESEARCH CORP has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, LAM RESEARCH CORP increased its bottom line by earning $5.79 versus $2.71 in the prior year. For the next year, the market is expecting a contraction of 63.5% in earnings ($2.12 versus $5.79).
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Lam Research Corporation designs, manufactures, markets, refurbishes, and services semiconductor processing equipments used in the fabrication of integrated circuits. The company offers etch products that remove portions of various films from the wafer in the creation of semiconductor devices. The company has a P/E ratio of 12.6, above the average electronics industry P/E ratio of nine and below the S&P 500 P/E ratio of 17.7. Lam Research has a market cap of $5.18 billion and is part of the
sector and
industry. Shares are up 12.8% year to date as of the close of trading on Thursday.
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-- Written by a member of TheStreet RatingsStaff
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