Lam Research (NASDAQ:LRCX) Stock Price Down 3.2% – Should You Sell?

Lam Research Corporation (NASDAQ:LRCX) dropped 3.2% on Tuesday. The stock traded as low as $260.29 and last traded at $263.45. Approximately 7,681,523 shares changed hands during trading, a decline of 28% from the average session volume of 10,652,305 shares. The stock had previously closed at $272.20.

Lam Research News Roundup

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

• Positive Sentiment: Earnings beat potential: Lam Research has a strong history of exceeding estimates, and Zacks says its Earnings ESP and recent operating trends point to another possible beat. Analysts are focused on the October 21 report, when Lam is expected to discuss revenue, margins and demand for memory and AI-related equipment. Why Lam Research Is Poised to Beat Earnings Estimates Again
• Positive Sentiment: Strong underlying results and outlook: Lam’s latest quarter produced record revenue of $6.72 billion, up 30% year over year, while earnings exceeded expectations. Prior guidance called for roughly $8.10 billion in September-quarter revenue and non-GAAP EPS of approximately $2.15, supporting the bullish case if management confirms continued AI, DRAM and advanced-packaging demand. Lam Research Bull Case Ahead of Earnings
• Neutral Sentiment: Analyst optimism remains: Recent price targets have generally ranged from $400 to $500, well above prevailing levels, indicating substantial long-term upside if semiconductor investment remains strong. However, these targets predate the upcoming earnings update and may be revised based on guidance.
• Negative Sentiment: Pre-earnings and sector pressure: Investors are trimming or hedging positions before results, and weakness across chip-equipment companies suggests concerns that 2027 capital spending may not sustain the elevated expectations created by the AI boom. Lam’s record prior quarter also raises the bar for its next report. Lam Research Slips Ahead of Earnings
• Negative Sentiment: Insider selling adds caution: Company insiders reported 55 open-market sales and no purchases over the past six months, including sales by Chief Executive Officer Timothy Archer and other senior executives. This may reinforce short-term investor concerns, although insider transactions do not necessarily indicate a change in business fundamentals.

Wall Street Analysts Forecast Growth

A number of brokerages have issued reports on LRCX. Deutsche Bank Aktiengesellschaft reaffirmed a “buy” rating and issued a $375.00 price objective on shares of Lam Research in a research report on Monday. Zacks Research upgraded shares of Lam Research from a “hold” rating to a “strong-buy” rating in a research report on Friday, July 17th. Jefferies Financial Group set a $335.00 price target on shares of Lam Research and gave the company a “buy” rating in a research report on Thursday, July 30th. Stifel Nicolaus raised their target price on shares of Lam Research from $325.00 to $425.00 and gave the company a “buy” rating in a research note on Friday, July 10th. Finally, Cantor Fitzgerald set a $500.00 target price on shares of Lam Research and gave the stock an “overweight” rating in a research note on Monday, June 29th. One investment analyst has rated the stock with a Strong Buy rating, twenty-six have assigned a Buy rating and five have issued a Hold rating to the company’s stock. Based on data from MarketBeat.com, the stock has an average rating of “Moderate Buy” and a consensus target price of $365.07.

Lam Research Trading Down 3.2%

The company has a debt-to-equity ratio of 0.30, a current ratio of 2.63 and a quick ratio of 1.91. The stock’s 50-day simple moving average is $308.34 and its two-hundred day simple moving average is $309.21. The firm has a market capitalization of $329.69 billion, a P/E ratio of 45.74, a price-to-earnings-growth ratio of 1.05 and a beta of 1.85.

Lam Research (NASDAQ:LRCX) last released its quarterly earnings data on Wednesday, July 29th. The semiconductor company reported $1.82 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.69 by $0.13. The business had revenue of $6.72 billion for the quarter, compared to the consensus estimate of $6.66 billion. Lam Research had a return on equity of 67.60% and a net margin of 31.27%. The company’s revenue was up 30.0% compared to the same quarter last year. During the same quarter in the previous year, the company posted $1.33 EPS. Lam Research has set its Q1 2027 guidance at 2.000-2.300 EPS. Equities research analysts expect that Lam Research Corporation will post 9.34 EPS for the current year.

Lam Research Increases Dividend

The company also recently declared a quarterly dividend, which was paid on Wednesday, October 14th. Stockholders of record on Wednesday, September 23rd were given a dividend of $0.33 per share. This represents a $1.32 dividend on an annualized basis and a dividend yield of 0.5%. The ex-dividend date of this dividend was Wednesday, September 23rd. This is a positive change from Lam Research’s previous quarterly dividend of $0.26. Lam Research’s dividend payout ratio is currently 22.92%.

Insider Buying and Selling at Lam Research

In other Lam Research news, Director Bethany Mayer sold 9,557 shares of the business’s stock in a transaction that occurred on Wednesday, September 9th. The shares were sold at an average price of $314.74, for a total transaction of $3,007,970.18. Following the sale, the director owned 20,995 shares of the company’s stock, valued at approximately $6,607,966.30. The trade was a 31.28% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, insider Ava Harter sold 5,000 shares of the firm’s stock in a transaction that occurred on Monday, August 31st. The stock was sold at an average price of $302.46, for a total transaction of $1,512,300.00. Following the transaction, the insider directly owned 42,462 shares of the company’s stock, valued at $12,843,056.52. This represents a 10.53% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders own 0.31% of the company’s stock.

Institutional Investors Weigh In On Lam Research

Several hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Van ECK Associates Corp grew its position in Lam Research by 411.8% during 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 during the period. Bank of New York Mellon Corp acquired a new position in shares of Lam Research in the second quarter worth about $3,777,585,000. Jennison Associates LLC boosted its stake in shares of Lam Research by 296.9% during the 1st quarter. Jennison Associates LLC now owns 3,373,306 shares of the semiconductor company’s stock worth $720,740,000 after acquiring an additional 2,523,351 shares in the last quarter. Assenagon Asset Management S.A. grew its position in shares of Lam Research by 1,994.3% during the 1st quarter. Assenagon Asset Management S.A. now owns 2,116,233 shares of the semiconductor company’s stock valued at $452,154,000 after acquiring an additional 2,015,188 shares during the period. Finally, California Public Employees Retirement System grew its position in shares of Lam Research by 50.6% during the 1st quarter. California Public Employees Retirement System now owns 5,870,899 shares of the semiconductor company’s stock valued at $1,254,376,000 after acquiring an additional 1,972,277 shares during the period. 84.61% of the stock is owned by institutional investors and hedge funds.

Lam Research Company Profile

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.