Lam Research Corporation (NASDAQ:LRCX) Is Trading Up Over 5%, Will There Be Further Upside Potentials?

Lam Research Corporation (NASDAQ:LRCX) Is Trading Up Over 5%, Will There Be Further Upside Potentials?


Lam Research Corporation (NASDAQ:LRCX) has attracted at least three brokerages’ view to offer their opinion following the March quarter results announcement on Tuesday. Two of them have boosted their target price on the stock while all the three have reiterated their respective rating.

CFRA has boosted its 12-month price objective from $130 to $150 on Lam Research stock. This implies that the stock offers more than 15 percent upside potentials from the current levels. Analyst Zino defended his price target by pointing out near peers PE of 14.2X his fiscal year ending June 2018 EPS estimate. He also lifted his EPS expectations from $9.27 to $9.86 for fiscal year ending June 2017. Similarly, for the fiscal year 2018, the brokerage boosted its EPS view from $8.76 to $10.61.

Zino noted that the company delivered earnings of $2.80 a share for March quarter exceeding Capital IQ consensus of $2.56. Sales advanced 14 percent from December quarter while margins expanded. These were better than expected driven by increased demand from memory.

In his research note to clients, Zino viewed, “We expect higher 3D NAND investments to remain elevated through calendar ’17 and remain optimistic about opportunities in China. We see foundry technology transitions keeping orders elevated.”

Another brokerage, RBC has also lifted its price objective to $145 from $140 while retaining an Outperform rating on the stock. B. Riley has a target price of $175 and reiterated its Buy rating. That would mean that Lam Research shares could witness a minimum upside potentials of nearly seven percent while the maximum upside rewards could be close to 29 percent.

Lam Research stock is trading up 6.0 percent at time of writing this.