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Lam Research Corporation (LRCX) Stock: How Does it Score on Fundamental Metrics?

Thursday, May 13, 2021 12:23 PM | InvestorsObserver Analysts
Lam Research Corporation (LRCX) Stock: How Does it Score on Fundamental Metrics?

Lam Research Corporation (LRCX) receives a strong valuation ranking of 76 from InvestorsObserver's data analysis. The proprietary ranking system focuses on the underlying health of a company through analysis of its stock price, earnings, and growth rate. LRCX has a better value than 76% of stocks based on these valuation analytics. Investors primarily focused on buy-and-hold strategies will find the valuation ranking relevant to their goals when making investment decisions.

Valuation Rank - 76
LRCX gets a 76 Valuation Rank today. Find out what this means to you and get the rest of the rankings on LRCX!

Metrics Analysis

LRCX has a trailing twelve month Price to Earnings (PE) ratio of 23.6. The historical average of roughly 15 shows a poor value for LRCX stock as investors are paying higher share prices relative to the company's earnings. LRCX's high trailing PE ratio shows that the firm has been trading above its fair market value recently. Its trailing 12-month earnings per share (EPS) of 23.67 does not justify the stock's current price. However, trailing PE ratios do not factor in the company's projected growth rate, resulting in many newer firms having high PE ratios due to high growth potential enticing investors despite inadequate earnings.

LRCX currently has a 12-month-forward-PE-to-Growth (PEG) ratio of 0.67. The market is currently undervaluing LRCX in relation to its projected growth due to the PEG ratio being below the fair market value of 1. LRCX's PEG comes from its forward price to earnings ratio being divided by its growth rate. Because PEG ratios include more fundamentals of a company's overall health with additional focus on the future, they are one of the most used valuation metrics by analysts.

Summary

All together these valuation metrics paint a pretty strong picture for LRCX at its current price due to a undervalued PEG ratio despite strong growth. The PE and PEG for LRCX are better than the average of the market resulting in a valuation score of 76.

Click Here to get the full Stock Score Report on Lam Research Corporation (LRCX) Stock.

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