
Lam Research (LRCX) is a leading player in the semiconductor industry with a valuation of over $94 billion.Â
Unlike popular chip companies like Nvidia and AMD, Lam Research is not a household name since its solutions are used in the manufacturing of semiconductors.Â
Foundry companies like Taiwan Semiconductor, Intel, and GlobalFoundries use the company’s solutions. These firms manufacture products like non-volatile memory (NVM), dynamic random-access memory (DRAM), and logic devices. Some of the end users are firms like Micron, SK Hynix, and Samsung.Â
Lam Research’s business has done well in the past few years, helped by the popularity of technologies like cloud computing, artificial intelligence, 5G and Internet of Things (IoT).Â
Lam’s annual revenue was $10 billion in 2019 and peaked at $17.4 billion in 2022 as demand for chips jumped. It then cooled in the last financial year as the semiconductor industry cooled. It is now in a recovery mode as analysts boost their forward revenue estimates because of the ongoing AI demand.Â
Lam Research stock has soared by 834% in the last decade and by 26% in the last twelve months. This year, however, it has dropped by 2.25%, underperforming the broader market. It was trading at $76.57 on Friday, with its HypeIndex metric rising to 192%.

Positive hype
Lam Research stock has attracted positive hype after rising by 5% after publishing its financial results this week.
The numbers showed that the company’s business was in a recovery mode as demand for NAND and AI industries continued.
In particular, the company noted that the NAND business was seeing more traction because of layer upgrades and Moly transition.
Lam Research’s revenue rose by 8% to $4.16 billion, while its gross margins rose from 47.5% to 48%.
Most of its revenue was from its system sales, while the customer support-related revenue rose to $1.7 billion.
Lam Research has a strong balance sheet, with over $6 billion in cash and equivalents and $2.9 billion in accounts receivables. Also, its inventories have continued falling, reaching $4.2 billion in the last quarter.
Lam is a high-margin company with an EBITDA and net income margin of 48% and 26%.Â
It is also a dependable dividend company with a dividend yield of 1.26% and a payout ratio of 7.58%. It has grown its payouts in the last nine consecutive years.
Analysts are optimistic about Lam Research’s business, with the annual revenue estimate being at $17.35 billion, a big increase from $14.9 billion in the same period last year. Revenue is expected to rise to almost $20 billion next year.Â
Analysts believe that Lam Research stock has more upside, with the average estimate being $94.25, much higher than the current $76.57.Â
Negative hype
Lam Research could be affected if Donald Trump wins the general election, a move that will lead to a trade war with China. The company makes substantial sums of money from China, which accounts for 37% of its total revenue.
Lam could also be affected if China decides to invade Taiwan. Taiwan is also a big market, accounting for 15% of total sales. Tensions between South Korea and North Korea could also hurt its business.Â
LAM Research could be affected as the artificial industry shows signs of peaking after growing in the past few years.Â
The stock formed a death cross pattern as the 50-day and 200-day Exponential Moving Averages (EMA) made a bearish crossover pattern.Â
Summary of Lam Research stock

Lam Research is a blue chip company that has a long track record of revenue and profitability growth. The firm’s business is in a recovery mode as demand for semiconductors rise.Â
It also published strong financial results that were much better than what analysts were expecting, a trend that could continue.Â
Lam Research stock, which remains in a bear market, could bounce back because it trades at a discount compared to other companies.
The challenge, however, is that the company has a large China exposure, which is a big risk as tensions with the US rise.
If you’d like to receive more trending stocks straight to your inbox, check out our premium plans. Alternatively, if you’d like to hear more about the services offered by HypeIndex, you can check out our FAQ page.
HypeIndex is an AI platform that detects Hype in stocks and cryptos before it moves the market, providing reliable early detection for profitable investment opportunities.
The algorithm for our proprietary HypeIndex score is based on sentiment analysis, data science and machine learning.
Comments