Lam Research (NASDAQ:LRCX) to Buy Back $25 billion in Shares

Lam Research (NASDAQ:LRCX) declared that its Board of Directors has approved a stock buyback program on Thursday, November 5th, RTT News reports. The company plans to repurchase $25 billion in shares. This buyback authorization allows the semiconductor company to repurchase up to 9% of its stock through open market purchases. Stock buyback programs are often an indication that the company’s leadership believes its shares are undervalued.

Wall Street Analyst Weigh In

LRCX has been the topic of a number of recent analyst reports. HSBC reissued a “hold” rating and set a $333.00 target price on shares of Lam Research in a report on Monday, July 27th. Morgan Stanley set a $339.00 price target on Lam Research and gave the company an “overweight” rating in a report on Thursday, October 22nd. TD Cowen reaffirmed a “buy” rating and set a $400.00 price objective (up from $340.00) on shares of Lam Research in a research report on Thursday, July 9th. B. Riley Financial upped their price objective on shares of Lam Research from $350.00 to $390.00 and gave the company a “buy” rating in a report on Thursday, October 1st. Finally, Stifel Nicolaus increased their price objective on shares of Lam Research from $325.00 to $425.00 and gave the company a “buy” rating in a research report on Friday, July 10th. Twenty-six analysts have rated the stock with a Buy rating and six have issued a Hold rating to the stock. According to data from MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and a consensus price target of $360.23.

Lam Research Stock Performance

Shares of NASDAQ:LRCX traded down $36.02 on Thursday, reaching $185.41. 31,297,422 shares of the company’s stock were exchanged, compared to its average volume of 11,545,254. The company has a fifty day moving average of $286.73 and a 200-day moving average of $283.78. Lam Research has a twelve month low of $135.50 and a twelve month high of $438.50. The company has a market capitalization of $231.61 billion, a price-to-earnings ratio of 32.76, a PEG ratio of 0.82 and a beta of 1.97. The company has a current ratio of 2.48, a quick ratio of 1.86 and a debt-to-equity ratio of 0.27.

Lam Research (NASDAQ:LRCX) last released its quarterly earnings results on Wednesday, October 21st. The semiconductor company reported $2.20 earnings per share for the quarter, beating analysts’ consensus estimates of $2.18 by $0.02. The company had revenue of $8.22 billion during the quarter, compared to the consensus estimate of $8.14 billion. Lam Research had a net margin of 32.34% and a return on equity of 72.15%. The firm’s quarterly revenue was up 54.4% on a year-over-year basis. During the same period in the previous year, the business earned $1.26 earnings per share. On average, research analysts predict that Lam Research will post 9.59 EPS for the current fiscal year.

Lam Research Increases Dividend

The business also recently disclosed a quarterly dividend, which was paid on Wednesday, October 14th. Shareholders of record on Wednesday, September 23rd were paid a dividend of $0.33 per share. This is a boost from Lam Research’s previous quarterly dividend of $0.26. The ex-dividend date was Wednesday, September 23rd. This represents a $1.32 dividend on an annualized basis and a yield of 0.7%. Lam Research’s dividend payout ratio is 19.67%.

Insiders Place Their Bets

In other Lam Research news, Director Bethany Mayer sold 9,557 shares of Lam Research stock in a transaction on Wednesday, September 9th. The stock was sold at an average price of $314.74, for a total value of $3,007,970.18. Following the completion of the transaction, the director directly owned 20,995 shares of the company’s stock, valued at $6,607,966.30. The trade was a 31.28% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Also, insider Ava Harter sold 5,000 shares of the company’s stock in a transaction on Monday, August 31st. The shares were sold at an average price of $302.46, for a total value of $1,512,300.00. Following the sale, the insider owned 42,462 shares of the company’s stock, valued at approximately $12,843,056.52. The trade was a 10.53% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 0.31% of the stock is owned by company insiders.

Trending Headlines about Lam Research

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

• Positive Sentiment: The board approved a $25 billion share repurchase authorization, allowing Lam to buy back up to 9% of its outstanding shares, and declared a quarterly dividend of $0.33 per share. The buyback may support demand for the stock and signals management’s willingness to return capital. Company announcement
• Negative Sentiment: Reports attributed the selloff to investors reconsidering AI-related semiconductor-equipment spending and the sustainability of the sector’s recent profitability. That uncertainty may weigh on Lam, whose business depends on semiconductor manufacturers’ investment cycles. Article on semiconductor-equipment investors reassessing AI spending
• Negative Sentiment: Lam’s latest outlook also highlighted execution risks: management expects component shortages and a near-term decline in China-related revenue. The company forecast December-quarter revenue of about $8.6 billion and diluted EPS near $2.33, so investors may focus on whether supply and regional headwinds affect delivery of those targets. Article on Lam’s guidance
• Neutral Sentiment: One report said the stock’s sharp drop had no clear company-specific catalyst, suggesting broader market or sector positioning may also have contributed. Article on Lam Research’s share-price move

About Lam Research

Lam Research Corporation (NASDAQ:LRCX) is a semiconductor equipment company that develops and manufactures systems used to fabricate integrated circuits. Its technologies support key stages of wafer processing, helping semiconductor manufacturers create the increasingly complex structures found in memory, logic and other types of chips.

The company’s product portfolio includes etch systems, which selectively remove materials from wafers; deposition systems, which apply thin films; and cleaning solutions used to remove contaminants and residue during manufacturing.