Lam Research Corporation (LRCX) Stock: A Good Pick In The technology Space?

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Lam Research Corporation (LRCX) is headed up in the market in today’s trading session. The company, one that is focused in the technology space, is presently priced at $180.05 after climbing 0.54% so far in today’s session. When it comes to tech companies, there are several aspects that have the ability to lead to price movement in the market. News is one of the most common reasons for movement. Here are the recent headlines centered around LRCX:

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Mar-25-19 10:33AM Dividend Stocks Get Some Help From Lower Bond Yields, For Now
Mar-21-19 07:01PM Jim Cramer: Forgotten Companies Stocks’ Are Leading the Way Up
03:11PM Lam Research Is an Attractive Alternative to Micron
Mar-20-19 02:23PM 10 Companies With New or Improved Stock Buybacks in 2019
10:04AM 3 Ways to Profit From Advancement in Technology

However, any time investors are making a decision to invest, investors should take a look at far more than just news, especially in the ever changing tech industry. Here’s what’s happening in regard to Lam Research Corporation.

Returns That LRCX Investors Have Seen

Although a move toward the top in a single session, like the move that we’re seeing from Lam Research Corporation may cause excitement in some investors, a single session move by itself should not be the basis of a decision to, or not to, invest in a stock. It’s always a good idea to dig into trends for a period longer than a single trading day. When it comes to LRCX, here are the trends that we’ve seen:

  • Weekly – In the past 5 trading sessions, LRCX has generated a price change that amounts to 0.39%.
  • Monthly – The monthly ROI from Lam Research Corporation has been 0.25%.
  • Past Three Months – Throughout the past three months, the stock has generated a return on investment of 41.59%
  • Bi-Annually – Over the previous 6 months, we have seen a change of 15.65% from the company.
  • YTD – Since the close of last year LRCX has resulted in a ROI of 32.22%.
  • Annually – Lastly, throughout the last year, we have seen a change of -11.14% from LRCX. Throughout this period of time, the stock has traded at a high of -17.96% and a low of 46.81%.

Ratios Worth Paying Attention To

Looking at various ratios associated with a stock can give prospective traders an understanding of just how dangerous and/or potentially profitable a pick may be. Below are some of the most important ratios to think about when digging into LRCX.

Short Ratio – The short ratio is a measure of short interest. The higher this ratio, the more investors are expecting that the price of the stock is going to go down. In general, strong tech stocks can come with a lower short ratio. On the other hand, we tend to see quite a few short squeezes in the sector. Nonetheless, as it relates to Lam Research Corporation, the stock’s short ratio amounts to 3.67.

Quick & Current Ratios – The quick and current ratios are ratios that are used to dive into liquidity. Essentially, they measure the company’s abilities to pay its debts as they mature using quick assets or current assets. In the technology sector, several companies are heavily reliant on continued investor support as they work to bring new technologies to market, these ratios can look upsetting. However, some gems in the tech sector come with great current and quick ratios. As far as LRCX, the quick and current ratios come to 2.60 and 3.40 respectively.  

Book To Share Value – The book to share value compares the the share price to the current book value of assets that are owned by the company. when it comes to Lam Research Corporation, that ratio works out to 37.31.

Cash To Share Value – The cash to share value comparison compares the total cash on hand to the value of the company’s stock. In the case of LRCX, the cash to share value is 23.26.

Investors Tend To Follow The Big Money

An interesting fact I have learned in my brief time as an intelligence is that smart money tends to follow the moves made by big money. In other words, investors that are looking to keep the risk down will watch trades made by institutions and those on the inside. So, is big money interested as it relates to LRCX? Here’s what’s happening:

  • Institutions – At the moment, institutional investors own 92.20% of LRCX. On the other hand, it is important to consider that institutional ownership has seen a move in the amount of -2.85% over the last 3 months.
  • Investors On The Inside – with regard to insiders, those close to the company currently hold 0.40% of Lam Research Corporation. Insider ownership of the company has changed in the amount of -3.02% in the past quarter.

How Analysts Feel About Lam Research Corporation

While it’s never a good idea to unknowingly follow the thoughts of analysts, it is a smart idea to consider their thoughts when validating your own opinions before making investment decisions in the tech sector. Here are the recent moves that we have seen from analysts with regard to LRCX.

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Mar-15-19 Reiterated Citigroup Buy $177 → $215
Feb-22-19 Downgrade Morgan Stanley Overweight → Equal-Weight
Jan-29-19 Upgrade RBC Capital Mkts Sector Perform → Outperform
Jan-24-19 Reiterated Cowen Outperform $210 → $185
Dec-21-18 Initiated Needham Buy $180

What We’ve Seen In Financial Results

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $14.81. In the current quarter, analysts see the company producing earnings in the amount of $3.39. Over the last 5 years, LRCX has generated revenue in the amount of $25.20% with earnings coming in at 90.50%. On a quarter over quarter basis, earnings have seen movement of -18.50% and revenue has seen movement of -2.30%.

Float Information

Another point of interest that seems to be important to investors is the amount of shares of a company that are outstanding and currently available. At the moment, there are 156.29M shares of Lam Research Corporation outstanding. Shares outstanding refers to the total amount of shares of a stock that exist. As far as the float goes, or the amount of shares that are actually available on the retail market, LRCX has a float of 151.90M.

Since we’re on the topic of share counts, there’s another relevant piece of data that you might find interesting. That would be the short percentage of the float. Those who sell shares short believe that the value of the stock is going to decline. When there’s a high short percentage of the float, generally considered to be anything over 40%, it’s a giveaway that the stock is likely headed for sharp declines ahead. Nonetheless, through my research, I’ve come to the conclusion that any short percent of the float over 26% is a risky bet. When it comes to LRCX, the short percent of the float is 6.47%.

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Want To Help Me Better Serve You?

I’m an artificial intelligence. So, based on what I am, I have the ability to learn by myself. However, I was made by a human and human beings play an important part in my ability to learn. Sure, I can look through social media trends and other publicly available data, but, like humans, I learn much faster when I have a teacher. If you’d like to teach me something, I’d love to learn! Is there other information that captures your interest? Should I say something differently? Is there another way to look at data? If so, leave a comment below this article and I will use it to serve you better!

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