Lam Research (NASDAQ:LRCX) Shares Gap Down on Analyst Downgrade

Lam Research Corporation (NASDAQ:LRCX)’s share price gapped down before the market opened on Thursday after Mizuho lowered their price target on the stock from $365.00 to $360.00. The stock had previously closed at $260.81, but opened at $234.50. Mizuho currently has an outperform rating on the stock. Lam Research shares last traded at $239.0890, with a volume of 4,394,313 shares trading hands.

Other equities research analysts have also recently issued research reports about the stock. TD Cowen reiterated a “buy” rating and set a $400.00 price target (up from $340.00) on shares of Lam Research in a research report on Thursday, July 9th. Fundamental Research set a $390.00 price objective on shares of Lam Research in a report on Thursday, October 1st. Jefferies Financial Group set a $335.00 price objective on shares of Lam Research and gave the company a “buy” rating in a research note on Thursday, July 30th. UBS Group reduced their price objective on shares of Lam Research from $435.00 to $425.00 and set a “buy” rating on the stock in a research note on Tuesday, September 1st. Finally, Needham & Company LLC lowered their target price on shares of Lam Research from $390.00 to $290.00 and set a “buy” rating for the company in a report on Thursday. One equities research analyst has rated the stock with a Strong Buy rating, twenty-six have issued a Buy rating and five have given a Hold rating to the stock. Based on data from MarketBeat, Lam Research presently has a consensus rating of “Moderate Buy” and an average target price of $360.20.

Insider Buying and Selling at Lam Research

In other Lam Research news, Director Bethany Mayer sold 9,557 shares of Lam Research stock in a transaction dated Wednesday, September 9th. The stock was sold at an average price of $314.74, for a total transaction of $3,007,970.18. Following the transaction, the director directly owned 20,995 shares in the company, valued at approximately $6,607,966.30. The trade was a 31.28% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, insider Ava Harter sold 5,000 shares of the business’s stock in a transaction dated 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 completion of the transaction, the insider directly 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 disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Company insiders own 0.31% of the company’s stock.

Key Stories Impacting Lam Research

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

• Positive Sentiment: Lam Research reported fiscal Q1 revenue of $8.22 billion, up 54.4% year over year and ahead of the $8.14 billion consensus estimate. Adjusted EPS of $2.20 also exceeded expectations, while operating margin reached a company-record 40%. Lam Research financial results
• Positive Sentiment: Management continues to see strong AI-infrastructure and memory-chip demand. It expects systems revenue to grow about 40% in 2026, customer-support revenue to increase more than 30% annually, and cumulative Aether dry-resist revenue to reach approximately $2.5 billion. Lam Research long-term investor takeaways
• Positive Sentiment: Cantor Fitzgerald retained Lam Research as a “top pick” with a $500 price target, citing an estimated $200 billion long-term market opportunity for semiconductor manufacturing equipment. Other analysts also continue to rate the shares Buy or Outperform.
• Neutral Sentiment: Lam guided to approximately $8.6 billion in fiscal Q2 revenue, roughly in line with consensus. However, investors had expected a stronger outlook following the quarter’s exceptional results, leaving little room for disappointment.
• Negative Sentiment: Supply-chain bottlenecks are delaying equipment shipments and limiting near-term revenue. Analysts characterized the guidance as below unofficial “whisper” expectations, prompting several price-target reductions, including Morgan Stanley’s cut to $339 and Needham’s reduction to $290. Lam Research guidance and analyst reaction
• Negative Sentiment: China’s contribution to revenue is expected to decline substantially from 35% in September, adding concern about regional demand and the sustainability of growth.
• Negative Sentiment: Broader semiconductor stocks are also weakening as investors revisit concerns about elevated AI-related capital spending and whether future returns will justify current valuations.

Hedge Funds Weigh In On Lam Research

Institutional investors and hedge funds have recently modified their holdings of the business. State Street Corp increased its stake in Lam Research by 2.6% during the 2nd quarter. State Street Corp now owns 60,704,130 shares of the semiconductor company’s stock worth $26,320,468,000 after purchasing an additional 1,545,830 shares in the last quarter. Bank of America Corp DE lifted its stake in Lam Research by 5.5% in the second quarter. Bank of America Corp DE now owns 11,244,147 shares of the semiconductor company’s stock valued at $4,872,426,000 after buying an additional 584,489 shares in the last quarter. Van ECK Associates Corp lifted its stake in Lam Research by 411.8% in the second quarter. Van ECK Associates Corp now owns 11,089,395 shares of the semiconductor company’s stock valued at $4,805,368,000 after buying an additional 8,922,854 shares in the last quarter. Amundi lifted its stake in Lam Research by 23.7% in the first quarter. Amundi now owns 10,147,479 shares of the semiconductor company’s stock valued at $2,168,107,000 after buying an additional 1,942,862 shares in the last quarter. Finally, Janus Henderson Group PLC boosted its holdings in shares of Lam Research by 2.0% in the first quarter. Janus Henderson Group PLC now owns 9,265,026 shares of the semiconductor company’s stock valued at $1,975,244,000 after buying an additional 181,087 shares during the period. 84.61% of the stock is currently owned by institutional investors and hedge funds.

Lam Research Price Performance

The company has a market cap of $299.07 billion, a price-to-earnings ratio of 41.57, a PEG ratio of 0.96 and a beta of 1.85. The company has a quick ratio of 1.91, a current ratio of 2.63 and a debt-to-equity ratio of 0.30. The company’s fifty day moving average price is $306.08 and its two-hundred day moving average price is $309.80.

Lam Research (NASDAQ:LRCX) last issued its quarterly earnings data on Wednesday, October 21st. The semiconductor company reported $2.20 earnings per share (EPS) for the quarter, topping the consensus estimate of $2.18 by $0.02. Lam Research had a net margin of 31.27% and a return on equity of 67.60%. The company had revenue of $8.22 billion during the quarter, compared to the consensus estimate of $8.14 billion. During the same quarter in the prior year, the firm earned $1.26 earnings per share. The firm’s revenue was up 54.4% compared to the same quarter last year. On average, equities research analysts forecast that Lam Research Corporation will post 9.35 EPS for the current fiscal year.

Lam Research Increases Dividend

The business also recently announced a quarterly dividend, which was paid on Wednesday, October 14th. Investors of record on Wednesday, September 23rd were paid a $0.33 dividend. This represents a $1.32 dividend on an annualized basis and a yield of 0.6%. The ex-dividend date of this dividend was Wednesday, September 23rd. This is a boost from Lam Research’s previous quarterly dividend of $0.26. Lam Research’s dividend payout ratio (DPR) is currently 22.92%.

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.