Lam Research (NASDAQ:LRCX) Shares Down 7.5% – What’s Next?

Shares of Lam Research Corporation (NASDAQ:LRCX) fell 7.5% on Tuesday . The stock traded as low as $258.53 and last traded at $269.61. Approximately 15,986,599 shares changed hands during mid-day trading, an increase of 41% from the average daily volume of 11,309,119 shares. The stock had previously closed at $291.61.

Key Stories Impacting Lam Research

Here are the key news stories impacting Lam Research this week:

• Positive Sentiment: Record results and strong guidance: Lam reported quarterly revenue of $6.72 billion, up 30% year over year, and adjusted EPS of $1.82 versus the $1.69 consensus estimate. Management guided for fiscal first-quarter revenue of approximately $7.7 billion to $8.5 billion and EPS of $2.00 to $2.30, exceeding consensus expectations of roughly $7.0 billion and $1.81, respectively. Reuters article
• Positive Sentiment: AI and memory demand are accelerating: Strong NAND-related revenue, expanding advanced packaging and wafer-fabrication demand, and record customer-support sales helped drive the quarter. Analysts characterized Lam’s opportunity heading into 2027 as an “extraordinary runway” tied to AI-driven semiconductor investment. Zacks article
• Positive Sentiment: Analysts raised earnings expectations: Needham maintained a Buy rating and $390 price target while increasing its EPS estimates after Lam lifted its chip-equipment market outlook. Several other analysts’ targets remain materially above the recent trading level, supporting the bullish reaction. Benzinga article
• Neutral Sentiment: Broader chip-sector rally: Lam’s report helped lift semiconductor stocks, alongside strong results from major technology companies and expectations of tighter memory supply. This broader enthusiasm may amplify gains but also makes the move more sensitive to sector sentiment. CNBC article
• Negative Sentiment: Valuation and execution risks remain: Morgan Stanley and B. Riley lowered their price targets despite retaining positive ratings, while recent data shows substantial insider selling and some institutional position reductions. Investors must also monitor semiconductor cyclicality, China-related equipment restrictions and whether elevated AI spending persists.

Analyst Ratings Changes

Several research firms recently weighed in on LRCX. Seaport Research Partners began coverage on Lam Research in a report on Monday, May 4th. They issued a “buy” rating and a $300.00 price objective for the company. Jefferies Financial Group set a $335.00 target price on shares of Lam Research and gave the stock a “buy” rating in a report on Thursday. Susquehanna reissued a “positive” rating and set a $475.00 target price (up from $385.00) on shares of Lam Research in a research report on Tuesday, June 30th. HSBC restated a “hold” rating and issued a $333.00 price target on shares of Lam Research in a report on Monday. Finally, Mizuho upped their price target on shares of Lam Research from $380.00 to $400.00 and gave the stock an “outperform” rating in a research report on Thursday, July 9th. One research analyst has rated the stock with a Strong Buy rating, twenty-eight have assigned a Buy rating and five have assigned a Hold rating to the stock. According to MarketBeat.com, Lam Research has an average rating of “Moderate Buy” and a consensus price target of $358.47.

Lam Research Trading Up 18.1%

The company has a current ratio of 2.54, a quick ratio of 1.77 and a debt-to-equity ratio of 0.35. The stock has a market capitalization of $372.66 billion, a P/E ratio of 56.23, a price-to-earnings-growth ratio of 1.60 and a beta of 1.80. The company has a 50-day moving average price of $341.14 and a 200 day moving average price of $275.79.

Lam Research (NASDAQ:LRCX) last issued its quarterly earnings data on Wednesday, July 29th. The semiconductor company reported $1.82 earnings per share for the quarter, beating analysts’ consensus estimates of $1.69 by $0.13. Lam Research had a return on equity of 66.21% and a net margin of 30.94%.The company had revenue of $6.72 billion for the quarter, compared to the consensus estimate of $6.66 billion. During the same quarter last year, the company earned $1.33 earnings per share. The firm’s revenue for the quarter was up 30.0% compared to the same quarter last year. Lam Research has set its Q1 2027 guidance at 2.000-2.300 EPS. On average, research analysts forecast that Lam Research Corporation will post 5.68 earnings per share for the current fiscal year.

Lam Research Announces Dividend

The company also recently declared a quarterly dividend, which was paid on Wednesday, July 8th. Stockholders of record on Wednesday, June 17th were issued a $0.26 dividend. This represents a $1.04 dividend on an annualized basis and a dividend yield of 0.3%. The ex-dividend date was Wednesday, June 17th. Lam Research’s dividend payout ratio (DPR) is currently 19.62%.

Insider Transactions at Lam Research

In related news, Director Abhijit Y. Talwalkar sold 18,282 shares of the stock in a transaction that occurred on Monday, July 13th. The shares were sold at an average price of $335.00, for a total transaction of $6,124,470.00. Following the completion of the sale, the director owned 87,142 shares of the company’s stock, valued at $29,192,570. This represents a 17.34% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, SVP Neil J. Fernandes sold 18,170 shares of the firm’s stock in a transaction that occurred on Friday, May 1st. The shares were sold at an average price of $255.14, for a total transaction of $4,635,893.80. Following the completion of the sale, the senior vice president owned 66,129 shares of the company’s stock, valued at approximately $16,872,153.06. This trade represents a 21.55% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 98,611 shares of company stock valued at $32,250,190 in the last 90 days. Insiders own 0.31% of the company’s stock.

Institutional Trading of Lam Research

Hedge funds and other institutional investors have recently made changes to their positions in the business. Clarus Group Inc. purchased a new position in Lam Research during the 2nd quarter worth $243,000. Wealth Advisory Solutions LLC purchased a new stake in Lam Research in the second quarter valued at about $266,000. Petra Financial Advisors Inc. acquired a new stake in Lam Research in the second quarter worth about $463,000. Bogart Wealth LLC boosted its holdings in Lam Research by 10.9% in the second quarter. Bogart Wealth LLC now owns 1,807 shares of the semiconductor company’s stock worth $783,000 after acquiring an additional 177 shares in the last quarter. Finally, Stonebridge Financial Group LLC MO purchased a new stake in shares of Lam Research during the second quarter worth about $288,000. Hedge funds and other institutional investors own 84.61% of the company’s stock.

Lam Research Company Profile

Lam Research Corporation (NASDAQ: LRCX) is a global supplier of wafer fabrication equipment and services to the semiconductor industry. Founded in 1980 by David K. Lam and headquartered in Fremont, California, the company develops and manufactures systems used in multiple stages of semiconductor device production, including thin film deposition, plasma etch, wafer cleaning and related process modules and automation.

Lam’s product portfolio covers core process technologies employed by logic and memory manufacturers, with equipment designed to support advanced-node patterning, 3D NAND and other emerging device architectures.