Will Weakness in Lam Research Corporation's (NASDAQ:LRCX) Stock Prove Temporary Given Strong Fundamentals?

Simply Wall St.11-13

It is hard to get excited after looking at Lam Research's (NASDAQ:LRCX) recent performance, when its stock has declined 10% over the past three months. But if you pay close attention, you might gather...

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But if you pay close attention, you might gather...</p>\n\n<a href=\"https://finance.yahoo.com/news/weakness-lam-research-corporations-nasdaq-120014375.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"LU0444971666.USD","symbol_name":"天利全球科技基金","start_time":0,"source_url":"https://finance.yahoo.com/news/weakness-lam-research-corporations-nasdaq-120014375.html","article_id":"2483066009","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/l41e42VQ5mYbp9QbJWqBjA--~B/aD00MzI7dz0xMTk0O2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/simply_wall_st__316/6d8b2b39a15494b5ec639cfd33d24b53"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2483066009","pubTimestamp":1731499214,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"It is hard to get excited after looking at Lam Research's  recent performance, when its stock has declined 10% over the past three months. But if you pay close attention, you might gather that its strong financials could mean that the stock could potentially see an increase in value in the long-term, given how markets usually reward companies with good financial health. Particularly, we will be paying attention to Lam Research's  ROE today.Return on equity or ROE is a key measure used to assess how efficiently a company's management is utilizing the company's capital. Put another way, it reveals the company's success at turning shareholder investments into profits.Return on Equity = Net Profit  ÷ Shareholders' Equity. Lam Research's three-year median payout ratio to shareholders is 20% , which is on the lower side, so it seems like the management is reinvesting profits heavily to grow its business.","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU0444971666.USD":"天利全球科技基金","IE00BQXX3F31.USD":"GUINNESS GLOBAL INNOVATORS \"C\" (USD) ACC","BK4551":"寇图资本持仓","LU0061475181.USD":"THREADNEEDLE (LUX) AMERICAN \"AU\" (USD) ACC","IE00BFSS8Q28.SGD":"Janus Henderson Balanced A Inc SGD-H",".IXIC":"NASDAQ Composite","LU1035773651.USD":"AB SICAV I - GLOBAL VALUE PORTFOLIO \"AD\" (USD) INC","LU1642822529.SGD":"THREADNEEDLE (LUX) GLOBAL TECHNOLOGY \"A\" (SGD) ACC","BK4581":"高盛持仓","IE00B7KXQ091.USD":"Janus Henderson Balanced A Inc USD","NDAQ":"纳斯达克OMX交易所","BK4112":"金融交易所和数据","LU0476273544.USD":"CT (LUX) I GLOBAL TECHNOLOGY \"BU\" (USD) ACC","LRCX":"拉姆研究","LU1815336760.USD":"THREADNEEDLE (LUX) GLOBAL TECHNOLOGY \"AUP\" (USD) INC","QID":"纳指两倍做空ETF","IE00BFSS7M15.SGD":"Janus Henderson Balanced A Acc SGD-H","LU1974910355.USD":"Allianz Thematica Cl AMg DIS USD","LU1917777945.USD":"安联专题基金Cl AT Acc","LU0957808578.USD":"THREADNEEDLE (LUX) GLOBAL TECHNOLOGY \"ZU\" (USD) ACC","IE00BN29S564.USD":"JANUS HENDERSON BALANCED \"A3\" (USD) INC","IE00BJJMRX11.SGD":"Janus Henderson Balanced A Acc SGD","LU2106854487.HKD":"ALLIANZ THEMATICA \"AMG\" (HKD) INC","LU2095319765.USD":"Natixis Thematics Subscription Economy R/A USD","IE00BJJMRY28.SGD":"Janus Henderson Balanced A Inc SGD","BK4567":"ESG概念","LU0061474960.USD":"天利环球焦点基金AU Acc","SQQQ":"纳指三倍做空ETF","BK4147":"半导体设备","LU2210150020.SGD":"Natixis Thematics Subscription Economy R/A SGD","LU2023250504.SGD":"Allianz Thematica Cl AMg DIS H2-SGD","IE00BGHQF748.EUR":"GUINNESS GLOBAL MONEY MANAGERS \"C\" (EUR) ACC","BK4533":"AQR资本管理(全球第二大对冲基金)","QLD":"纳指两倍做多ETF","LU2210149790.SGD":"Natixis Thematics Subscription Economy R/A SGD-H","LU0957791311.USD":"THREADNEEDLE (LUX) GLOBAL FOCUS \"ZU\" (USD) ACC","LU0096362180.USD":"CT (LUX) I GLOBAL FOCUS \"DU\" (USD)","IE00BKPKM429.USD":"NEUBERGER BERMAN GLOBAL SUSTAINABLE EQUITY \"A\" (USD) ACC","PSQ":"纳指反向ETF","IE00B775H168.HKD":"JANUS HENDERSON BALANCED \"A5M\" (HKD) INC","IE0005OL40V9.USD":"JANUS HENDERSON BALANCED \"A6M\" (USD) INC","IE0004445015.USD":"JANUS HENDERSON BALANCED \"A2\" (USD) ACC","IE00BQXX3D17.EUR":"GUINNESS GLOBAL INNOVATORS \"C\" (EUR) ACC","BK4588":"碎股","IE00B3QW5Z07.USD":"GUINNESS GLOBAL MONEY MANAGERS \"C\" (USD) ACC","TQQQ":"纳指三倍做多ETF","IE00BQXX3C00.GBP":"GUINNESS GLOBAL INNOVATORS \"C\" (GBP) ACC"},"translate_title":"鉴于基本面强劲，泛林研究公司（纳斯达克股票代码：LRCX）股票的疲软是否是暂时的？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"LRCX":1,".IXIC":1,"NDAQ":1,"PSQ":0.6,"QID":0.6,"QLD":0.6,"SQQQ":0.6,"TQQQ":0.6,"MNQmain":0.6,"NQmain":0.6},"content_text":"It is hard to get excited after looking at Lam Research's (NASDAQ:LRCX) recent performance, when its stock has declined 10% over the past three months. But if you pay close attention, you might gather that its strong financials could mean that the stock could potentially see an increase in value in the long-term, given how markets usually reward companies with good financial health. Particularly, we will be paying attention to Lam Research's  ROE today. \n Return on equity or ROE is a key measure used to assess how efficiently a company's management is utilizing the company's capital. Put another way, it reveals the company's success at turning shareholder investments into profits. \n View our latest analysis for Lam Research \n How Do You Calculate Return On Equity? \n The formula for return on equity is: \n Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity \nSo, based on the above formula, the ROE for Lam Research is:\n48% = US$4.1b ÷ US$8.5b (Based on the trailing twelve months to September 2024).\n The 'return' refers to a company's earnings over the last year. Another way to think of that is that for every $1 worth of equity, the company was able to earn $0.48 in profit. \n What Is The Relationship Between ROE And Earnings Growth? \n So far, we've learned that ROE is a measure of a company's profitability. Depending on how much of these profits the company reinvests or \"retains\", and how effectively it does so, we are then able to assess a company’s earnings growth potential. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don’t share these attributes. \n Lam Research's Earnings Growth And 48% ROE \n Firstly, we acknowledge that Lam Research has a significantly high ROE. Secondly, even when compared to the industry average of 12% the company's ROE is quite impressive. Probably as a result of this, Lam Research was able to see a decent net income growth of 12% over the last five years. \n We then compared Lam Research's net income growth with the industry and found that the company's growth figure is lower than the average industry growth rate of 21% in the same 5-year period, which is a bit concerning. \n\n\n\n  NasdaqGS:LRCX Past Earnings Growth November 13th 2024\n \n\n Earnings growth is a huge factor in stock valuation. It’s important for an investor to know whether the market has priced in the company's expected earnings growth (or decline). Doing so will help them establish if the stock's future looks promising or ominous. Is LRCX fairly valued? This infographic on the company's intrinsic value  has everything you need to know. \n Is Lam Research Using Its Retained Earnings Effectively? \n Lam Research's three-year median payout ratio to shareholders is 20% (implying that it retains 80% of its income), which is on the lower side, so it seems like the management is reinvesting profits heavily to grow its business. \n Besides, Lam Research has been paying dividends for at least ten years or more. This shows that the company is committed to sharing profits with its shareholders. Based on the latest analysts' estimates, we found that the company's future payout ratio over the next three years is expected to hold steady at 21%. Accordingly, forecasts suggest that Lam Research's future ROE will be 46% which is again, similar to the current ROE. \n Summary \n Overall, we are quite pleased with Lam Research's performance. In particular, it's great to see that the company is investing heavily into its business and along with a high rate of return, that has resulted in a respectable growth in its earnings. The latest industry analyst forecasts show that the company is expected to maintain its current growth rate. To know more about the company's future earnings growth forecasts take a look at this free report on analyst forecasts for the company to find out more. \nHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2483066009"}