HOLD at $320.42 — Mechanical Triggers in Both Directions, Stop Tightened to $295
HOLD captures upside in confirmed structural upcycle while protecting against documented drawdown history. Path of least regret: don't Underweight an elite franchise sitting 18%+ above structurally defended 200 SMA (9/2 lesson), don't chase unconfirmed 50 SMA breakout (conservative), don't load up on 29-cent resistance (aggressive overreach), and don't sit passively without defined triggers (neutral synthesis). Dividend yield ~0.4% provides carry during the wait.
| Position | Action |
|---|---|
| Bullish breakout confirmed (close >$325 on 8M+ shares) | Add 25-50% of current position |
| Pullback to $306-$313 zone with MACD histogram holding positive and contracting dip volume | Add 25-50% of current position |
LRCX is a fundamentals-driven, structurally bullish secular play on the AI infrastructure build-out, with a tactical entry point being confirmed by technical breakout signals and a forward P/E that hasn't caught up to the earnings trajectory.
| Indicator | Value | Signal |
|---|---|---|
| close_200_sma | 261.57 | bullish |
| close_50_sma | 320.71 | neutral |
| close_10_ema | 306.15 | bullish |
| rsi | 53.91 | neutral |
| macd_line | -4.00 | neutral |
| macd_signal | -4.27 | neutral |
| macd_histogram | +0.28 | bullish |
| boll_middle | 313.46 | neutral |
| boll_upper | 343.41 | neutral |
| boll_lower | 283.52 | neutral |
| atr_14 | 16.21 |
This report is AI-generated for informational and educational purposes only and is not investment advice or a recommendation to buy or sell any security. Full disclaimer.
When: Successful test of $306-$313 zone with MACD histogram holding positive and contracting dip volume
Then: Re-engage with 25-50% position add
The recent 42% crash from $433 to $252 was a forced deleveraging event that created a gift entry point, and the recovery is confirming the uptrend is intact.
· concedes: Cyclicality: WFE is the most cyclical segment of semis; memory capex can collapse as it did in FY2024; China export controls could cap the upside on incremental orders; Beta of 1.86 means the stock will move 2x the market on macro days; Forward guidance disappointment risk is real since the market is pricing in continued execution; Macro concerns are real: Polymarket shows 78% probability of Hormuz disruption in 2026; Fed cut odds for September at 0% and December at 6%
The "AI infrastructure" trade is already priced in at 27.7x forward P/E for a cyclical equipment name requiring near-perfect execution; the setup is fragile, technically unconfirmed, and macro headwinds are accelerating rather than moderating.
EV: -$208 to -$231 (30-40% downside from $320 at 18-20x normalized WFE multiple) · concedes: HBM physics is correct and structural AI/WFE thesis has merit; LRCX will probably be higher in 12 months; Bull's presentation is polished and narrative is compelling; 2026-2027 capex is largely committed in backlog; Inventory is flat (not overbuilding) which is structurally positive
→ vs conservative: Waiting for daily close above $320.71 (29 cents above current price) before adding is excessive caution — by the time confirmation arrives, price will be at $325, $330, or higher, and analyst will STILL be waiting for confirmation above $343
→ vs conservative: Receivables growth of 58% YoY versus 26% revenue growth is being framed as red flag when it is actually a demand-pull-forward signal — longer DSO is the natural mechanism by which customers finance capital equipment build-outs
→ vs conservative: AMAT dropping 14% is not a valid leading WFE indicator for LRCX — different customer mix and end-market exposure; using AMAT as proxy for LRCX is sloppy analysis
→ vs conservative: 78% Hormuz disruption odds and 0% September Fed cut are Priced In — these are stale fears that have already compressed multiples, not new catalysts requiring caution
→ vs conservative: Beta 1.86 is being treated as asymmetric downside risk when it actually means amplified upside participation — the proper response is size accordingly and hold through noise, not avoid the position
→ vs conservative: 10b5-1 insider selling by CLO ($1.51M) and routine option exercise by CEO are noise, not signal — if this qualifies as bearish, every large-cap tech name in America should be underweighted
→ vs conservative: 420% five-year return mean-reversion risk is lazy thinking — mean reversion is a statistical tendency, not a deterministic law; stocks that have tripled due to structural earnings expansion don't mean-revert like zombie stocks
| vwma | 306.10 | bullish |
| volume | 8.68M shares | neutral |
| price | 320.42 | neutral |
Support: 306.15 · 283.52 · 261.57 · 252.35 | Resistance: 320.71 · 343.41 · 351.4 · 353.2
LRCX is transitioning from a bear-market bounce to a potential trend reversal, trading at $320.42 near the 50 SMA resistance of $320.71. Technical indicators show the MACD histogram just turned positive (+0.28) and RSI is at 53.91, indicating neutral-to-bullish momentum, while the ATR of $16.21 (~5% of price) reflects elevated volatility. The stock remains in a tactical recovery phase—bulls need a sustained daily close above $320.71 to confirm the reversal, while support sits at $306.15 (10 EMA/VWMA) with the Bollinger lower band at $283.52.
Market Cap
$400.95B
Share Price
~$320
52-Week High
$438.50
52-Week Low
$104.46
50-Day Avg
$321.88
200-Day Avg
$260.90
Trailing P/E
55.7x
Forward P/E
27.7x
PEG Ratio
1.43
P/B
32.1x
Dividend Yield
0.43%
Beta
1.86
Revenue (FY2026)
$23,233M
Revenue (FY2025)
$18,436M
Revenue (FY2024)
$14,905M
Revenue (FY2023)
$17,429M
Gross Profit (FY2026)
$11,725M
Gross Margin (FY2026)
50.5%
Gross Margin (FY2025)
48.7%
Gross Margin (FY2024)
47.3%
Gross Margin (FY2023)
44.6%
Operating Income (FY2026)
$8,200M
Operating Margin (FY2026)
35.3%
Operating Margin (FY2025)
32.0%
Operating Margin (FY2024)
28.6%
Net Income (FY2026)
$7,265M
Net Income (FY2025)
$5,358M
Net Income (FY2024)
$3,828M
Diluted EPS (FY2026)
$5.76
Diluted EPS (FY2025)
$4.15
Diluted EPS (FY2024)
$2.90
Diluted Avg Shares (FY2026)
1,261M
Diluted Avg Shares (FY2025)
1,290M
Diluted Avg Shares (FY2024)
1,320M
EBITDA (FY2026)
$8.86B
Net Interest Income (FY2026)
+$39M
Q4'26 Revenue
$6,722M
Q4'26 Gross Margin
51.8%
Q4'26 Diluted EPS
$1.81
Q3'26 Revenue
$5,841M
Q2'26 Revenue
$5,345M
Q1'26 Revenue
$5,324M
Cash & Equivalents (FY2026)
$5,579M
Cash & Equivalents (FY2025)
$6,391M
Receivables (FY2026)
$5,340M
Receivables (FY2024)
$2,519M
Inventory (FY2026)
$4,276M
Total Current Assets (FY2026)
$15,611M
Net PP&E (FY2026)
$2,956M
Goodwill & Intangibles (FY2026)
$1,896M
Total Assets (FY2026)
$23,530M
Total Debt (FY2026)
$3,735M
Net Cash (FY2026)
+$1,844M
Net Cash (FY2023)
+$325M
Total Liabilities (FY2026)
$11,059M
Stockholders' Equity (FY2026)
$12,471M
Stockholders' Equity (FY2025)
$9,862M
Retained Earnings
$34.95B
Treasury Stock
$31.6B
Current Ratio (FY2026)
2.63x
Current Ratio (FY2024)
2.97x
Total Debt / Equity (FY2026)
0.30x
Total Debt / Equity (FY2023)
0.61x
Deferred Revenue (FY2026)
$2.28B
Operating Cash Flow (FY2026)
$5,858M
Operating Cash Flow (FY2025)
$6,173M
Free Cash Flow (FY2026)
$4,891M
Free Cash Flow (FY2025)
$5,414M
CapEx (FY2026)
$966M
CapEx (FY2024)
$397M
Change in Working Capital (FY2026)
-$1,914M
D&A (FY2026)
$442M
Stock-Based Compensation (FY2026)
$386M
Share Repurchases (FY2026)
$3,851M
Share Repurchases (FY2025)
$3,422M
Dividends Paid (FY2026)
$1,271M
Dividends Paid (FY2025)
$1,150M
Total Returned to Shareholders (FY2026)
$5,122M
Debt Repaid (FY2026)
$755M
Net Change in Cash (FY2026)
-$782M
Profit Margin (TTM)
31.3%
Operating Margin (TTM)
37.4%
Return on Equity (TTM)
65.1%
Return on Assets (TTM)
22.8%
FCF (TTM)
$3.09B
FCF Yield
~0.8%
Net Cash / Market Cap
+0.5%
CapEx / Revenue
~4%
Forward EPS Estimate
$11.57
Strengths
Concerns
Lam Research Corporation delivered strong FY2026 results with $23.2B in revenue (+26% YoY) and record Q4'26 revenue of $6.72B, driven by AI-driven semiconductor capex. The company demonstrates best-in-class profitability metrics including 50.5% gross margin, 35.3% operating margin, and 65.1% ROE, while maintaining a net cash balance sheet and returning over $5.1B to shareholders through buybacks and dividends. Key risks include high cyclicality exposure in WFE, receivables growth outpacing revenue, elevated trailing valuation, and ongoing China export control uncertainties.
Macro: Iran conflict-driven oil price surge creating inflationary headwinds and pressuring Federal Reserve to maintain restrictive policy (Sept cut: 0%, Dec cut: 6%); Strait of Hormuz disruption probability at 78% ($265K vol); US crude reserves tightening (77% odds of falling to 280M by Sept 25); US recession odds at 8% but rising slowly; FRED macro series unavailable due to missing API key; geopolitical risk is headline-active and creates asymmetric downside for growth-multiple names like LRCX.