Fundamentals snapshot
LRCX · NMS · Technology · Semiconductor Equipment & Materials
Current price
$324.45
52-week range
$87.02 - $346.19
Market cap
$405.75B
One-glance verdict
Fair-value range $48.30 – $109.62 (cautious → optimistic — tap the ? for the math)
Wall Street consensus: $316.19 (333.4% higher than our fair-value estimate)
Buy below $58.36 for a 20% safety cushion
Balance sheet
Net cash $1.02B. Interest coverage shows how many times profit covers the interest bill.
What stands out
Quick scan of the biggest positives and negatives from the detailed checklist below.
What this company does
Lam Research makes the highly specialized, complex machines that other companies use to manufacture computer chips, the tiny electronic brains inside phones, cars, and computers. It earns money not just by selling these multi-million dollar tools, but also by servicing them and selling parts, creating a stream of recurring revenue (predictable income from ongoing services). Because nearly every advanced electronic device relies on chips, Lam's business is fundamental to the entire tech industry.
Founded in 1980 by Dr. David K. Lam, the company pioneered a new way to manufacture computer chips. Instead of using liquid chemicals, Lam developed a 'dry' process using plasma to etch microscopic circuits onto silicon wafers, which are thin slices of semiconductor material. This innovation allowed chipmakers to create much smaller and more precise components. Through key acquisitions, like Novellus Systems in 2012, Lam expanded its capabilities beyond etching to include depositing ultra-thin layers of materials, becoming a one-stop-shop for some of the most critical steps in chipmaking.
You can't buy a Lam Research product in a store, but their equipment is essential for making the chips inside the electronics you use every day, like smartphones, computers, and smart cars. Think of Lam as building the ultra-precise robots and machines that other companies, the chipmakers, use to construct the microscopic circuitry on a silicon wafer. These machines perform two main tasks with atomic-level precision: depositing thin layers of materials and then carving or 'etching' intricate patterns into those layers. This process, repeated hundreds of times, creates the complex, multi-layered integrated circuits that power modern technology.
This is Lam's largest business area, making up well over half of its revenue. This segment sells the highly complex machines that physically build the chips. These machines perform two primary, incredibly precise jobs: deposition (adding ultra-thin layers of conductive or insulating materials onto a silicon wafer) and etch (selectively removing those materials to create the chip's features). The customers for these systems are the big semiconductor manufacturers themselves, who buy this equipment to outfit their massive factories, often called 'fabs'.
This part of the company generates a significant and more stable stream of revenue, representing a little less than half of the total. After a chipmaker buys a multi-million dollar machine from the Systems division, the CSBG provides everything needed to keep that machine running efficiently for years. This includes spare parts, maintenance services, software, and upgrades to the equipment. Because there are tens of thousands of Lam machines installed in factories worldwide, this creates a large and consistent business of servicing and improving that installed base.
Lam's leadership is focused on inventing the technology needed for the next generation of even more complex chips, particularly those with 3D structures. As chipmakers stack components vertically to increase power, they need more of the advanced deposition and etch processes that are Lam's specialty. The company is also investing heavily in service offerings that use data and artificial intelligence to predict when machines might need maintenance, improving factory efficiency for their customers. Finally, they are expanding their manufacturing capabilities globally, such as in Malaysia, to create a more resilient supply chain (the network of companies that provides parts and materials) and be closer to their major customers in Asia.
Price history
Earnings history
Click any quarter to read the call summary and what the numbers say.
Is it cheap or expensive?
Wall Street consensus is the average analyst price target: $316.19 (333.4% higher than our fair-value estimate).
Buy below $58.36 for a 20% safety cushion. That means buying at least 20% below our fair value, as a buffer in case our estimate turns out too rosy.
Our most-likely fair value is $72.95 a share — about 77.5% below today's price of $324.45, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Net cash $1.0B - more cash than debt. Interest coverage 33.1x.
Lam Research Corporation's profit covers its interest bill about 33.1 times over. which is stronger than most peers shown here.
Total debt $3.73B Interest coverage 33.11x This is the baseline the peer rows are being compared against.
Total debt $7.27B Interest coverage 31.49x -5% vs LRCX Has roughly the same debt cushion as LRCX.
Total debt $3.12B Interest coverage 95.53x +188% vs LRCX Carries about 2.9x more debt cushion than LRCX.
Total debt $6.15B Interest coverage 16.59x -50% vs LRCX Carries about 2.0x less debt cushion than LRCX.
Total debt $0.00 Interest coverage 317.98x +860% vs LRCX Carries about 9.6x more debt cushion than LRCX.
Total debt $83.10M Interest coverage 1,042.33x +3,048% vs LRCX Carries about 31.5x more debt cushion than LRCX.
What you should know
The numbers
Tap any ? icon to learn what it means.
Valuation
Profitability
Health
Growth
Cash flow
Dividend
Metric explainer
Debt comparison
What you should know