So, immediately I have to question your response since you preface by wondering if I'm short. No, I am not short LRCX. I appreciate your input, as that was what I was looking for, an opinion on where the stock price is today. Last year at this time, the stock was trading around $230 and after this year's mini crash, it was trading around that price again. Several months ago, I pointed out how LRCX was substantially undervalued. Well, the 50% gain in the stock since then has taken them way past where I would say is fair value.
I get concerned with stocks getting ahead of themselves, price wise, as it often leads to either stagnation or a large drop when either the company or the world takes off the rose colored glasses. I have a serious problem pricing out LRCX based on what's going to be happening 3 years out, especially with our current global problems.
Lam has done brilliantly the past couple of years, relatively speaking to it's industry, and I continue to expect good things from the company and the sector. I also believe this stock's price is way ahead of where it should be - my view - as I think achieving their goals 2+ years away is not a lock. I look forward to them excelling but I also think it's unwise to discount, in advance, any bumps in the road.
You've basically stated that they will more than double their quarterly earnings in 2 and a half years. From $16/sh to mid the 30s. And with this as the future, we should price the stock accordingly. I say, whoa. Easy there. One great quarter, the first one in several where they beat by a large percentage, does not mean the company's vision for the future is a lock. |
