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5 Reasons Why You Should Buy Lam Research (LRCX) Stock Now

Zacks Equity Research
Updated

Lam Research Corporation LRCX is currently one of the top-performing stocks in the technology sector and an increase in share price and strong fundamentals signal its bullish run. Therefore, if you haven’t taken advantage of the share price appreciation yet, it’s time you add the stock to your portfolio.

The company has performed extremely well so far this year and possesses the potential to carry on the momentum in the near term.

Here are a few reasons why the stock is worth considering.

An Outperformer: A look at the company’s price trend reveals that the stock has had an impressive run on the bourse year to date. Lam has gained 70.5% compared with the industry’s rally of 56.5%.

Solid Rank & VGM Score: Lam sports a Zacks Rank #2 (Buy) and has a VGM Score of A. Our research shows that stocks with a VGM Score of A or B when combined with a Zacks Rank #1 (Strong Buy) or #2 offer the best investment opportunities for investors. Thus, the company appears to be a compelling investment proposition at the moment.

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Positive Earnings Surprise History: Lam has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average positive earnings surprise of 5.3%.

Strong Growth Prospects: The company’s Zacks Consensus Estimate for fiscal 2018 earnings of $14.74 reflects year-over-year growth of 47.7%. Moreover, earnings are expected to register 0.7% growth in fiscal 2019. The stock has long-term expected earnings per share growth rate of 14.9%.

Growth Drivers: Lam Research is doing well and continues to succeed in areas such as device architecture, process flow and advanced packaging technology inflections.

The company has been improving on its WFE market share significantly since 2013 and expects to make robust gains in 2018.

Management said that strong demand for bit growth in server DRAM and NAND will continue, driven by cloud computing and IoT, thus creating more opportunities for Lam Research in the near future.

Lam Research continues to witness increased adoption rates of 3D NAND technology, FinFETs and multi-patterning. The company has undertaken cost-reduction activities and density scaling for 3D NAND and new memory technologies.

Moreover, the company anticipates continued strong demand for leading-edge silicon in the enterprise market courtesy of the long-term move to cloud, storage and networking applications.

Lam Research Corporation Price and Consensus

 

Lam Research Corporation Price and Consensus | Lam Research Corporation Quote

Stocks to Consider

Other top-ranked stocks in the broader technology sector are ASML Holding N.V. ASML, KLA-Tencor Corporation KLAC and PetMed Express, Inc. PETS, each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings per share growth rate for ASML Holding and PetMed Express is projected to be 22.6% and 10%, respectively.

Wall Street’s Next Amazon

Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.

Click for details >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
PetMed Express, Inc. (PETS) : Free Stock Analysis Report
 
KLA-Tencor Corporation (KLAC) : Free Stock Analysis Report
 
ASML Holding N.V. (ASML) : Free Stock Analysis Report
 
Lam Research Corporation (LRCX) : Free Stock Analysis Report
 
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