That's funny, I thought INTC just upped their capex two nights ago. As for "Story is solid but stock outperformance has run its course" LRCX still has a lower multiple on a P/E or PSR basis than AMAT, and well below the market average.
The landscape for makers of semiconductor equipment is becoming tougher as chip makers are expected to spend less on chip equipment this year, especially at companies that make memory chips for consumer electronic devices.
Lam Research faces sell-off
Stock retreats from 52-week high
By Matt Andrejczak, MarketWatch
Last Update: 12:31 PM ET July 21, 2005
SAN FRANCISCO (MarketWatch) - Lam Research Corp., the No. 3 U.S. chip equipment maker, retreated from its 52-week highs Thursday, weighed down by Wall Street downgrades.
The stock (LRCX: news, chart, profile) fell about 8% to $30.01 in midday trading.
The slide comes after Lam Research reported late Tuesday that its fourth-quarter profit rose 26% from a year earlier. The results topped Wall Street's estimates, but near-term growth is expected to slow.
"Story is solid but stock outperformance has run its course," wrote Credit Suisse analyst John Pitzer, who lowered the stock's rating to neutral from outperform.
On Tuesday, shares of Lam Research set a 52-week high of $32.61. The stock is up about 65% since the lows it hit last summer.
"It is time to take profits," wrote Gerald Fleming, an analyst at W.R. Hambrecht & Co., which downgraded the stock to hold from buy.
The landscape for makers of semiconductor equipment is becoming tougher as chip makers are expected to spend less on chip equipment this year, especially at companies that make memory chips for consumer electronic devices.
Lam Research, of Fremont, Calif., has had flat order growth for the past two quarters. Its order book for the three months ended June 27 was $315 million. Memory chip makers made up 53% of those orders.
In a conference call, the company signaled a pickup in new orders is more likely late in the year. It said its order book for the quarter ending in September could drop 5% from the three months ended June 27.
Lam Research is forecasting revenue in the range of $310 million to $330 million, down 7% to 12% from the June quarter.
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