Lam ResearchNASDAQ: LRCX

This semiconductor equipment company has recently reported strong results and a positive forecast.

In the week before the first quarter earnings report for its 2025 fiscal year, Lam Research Corp. (NASDAQ: LRCX) saw its stock drop by almost 15%. Additionally, analysts have been reducing their price targets for LRCX due to worries about slowing growth, which could hinder the stock's ability to perform better than the market.

An industry expert predicts that the NAND memory market will expand in 2025, mainly due to Solid-State Devices and smartphones. Experts believe that NAND memory producers will raise their capital expenditures in 2025, which could greatly help Lam. The company's PEG ratio for the next year is 0.77, suggesting it may be undervalued.

BofA Securities analyst Vivek Arya has maintained a Buy rating for Lam Research (LRCX) and increased the price target from $88 to $92.

LRCX's earnings for the first quarter show that the Customer Support Business Group did well, and there has been a recovery in the System business.

Since early July, Lam Research Corporation has lagged behind the S&P 500 by 35%, leading to a change in its valuations. After reviewing the results and outlook for the first quarter of FY25, we maintain our buy rating. We believe that worries about high shipments to China are over, as these are projected to fall to 30% of total sales next quarter, with spending from other regions expected to help boost performance in FY25.

I maintain a 'Strong Buy' recommendation for Lam Research, setting a one-year price target of $95 due to strong growth prospects in the HBM-Driven DRAM and 3D NAND sectors. The Lam Cryo 3.0 technology etches 2.5 times faster and cuts energy use by 40%, which helps Lam Research keep up with the increasing demand for 3D NAND. In the first quarter, the company reported a 19.7% increase in revenue compared to last year, with a bright outlook for the NAND market and considerable growth potential from changes in metallization.

On Wednesday, Lam Research predicted that its revenue for the December quarter would exceed Wall Street's expectations, as chipmakers increased their orders for equipment used in making semiconductors for artificial intelligence.

Lam Research (LRCX) reported quarterly earnings of $0.86 per share, which is higher than the Zacks Consensus Estimate of $0.80 per share. This is an increase compared to earnings of $0.69 per share from the same period last year.