Can KLAC Get Its Mojo Back?
Stephen Simpson, CFA
Stephen Simpson, CFA
Thu, Nov. 17, 12:18 PM
- In no surprise, the list is dominated by the ripping financial sector:
- Allstate (ALL +1.4%)
- Ameriprise (AMP +0.2%)
- TD Ameritrade (AMTD +1.6%)
- BB&T (BBT +2.1%)
- Citigroup (C +2.4%)
- Citizens Financial (CFG +2%)
- Comerica (CMA +1.5%)
- CNA Financial (CNA +0.6%)
- Loews Corp. (L +0.9%)
- Marsh & McLennan (MMC +1.9%)
- PNC Financial (PNC +2.6%)
- Royal Bank of Canada (RY +0.7%)
- U.S. Bancorp (USB +1.9%)
- Aetna (AET +1.5%)
- Best Buy (BBY +10.4%)
- CBS (CBS +0.6%)
- Celanese (CE +0.1%)
- Comcast (CMCSA +1.5%)
- Dell Technologies (DVMT +1.1%)
- The Gap (GPS +0.4%)
- Humana (HUM +1.4%)
- KLA-Tencor (KLAC +2.7%)
- Liberty Media (LMCA +1.6%)
- Lam Research (LRCX +1.9%)
- Micron (MU +5.3%)
- Nvidia (NVDA +2.7%)
- Rockwell (ROK -0.5%)
- Teck Resources (TCK +0.5%)
- Texas Instruments (TXN +1.1%)
- New lows:
- Novo Nordisk (NVO +0.3%)
Thu, Nov. 3, 5:41 PM
Fri, Oct. 21, 12:39 PM
- Results: KLA-Tencor beats by $0.13, beats on revenue
- Analyst Romit Shah moves from $67 to $75 (current price $73.85), noting that although Q1 results are positive, deceleration of revenue and earnings keep his valuation conservative. Neutral rating maintained.
- Analysts at Needham & Compan and Cowen and Company, however, both more enthusiastic on KLA-Tencor, reissue respective Buy and Outperform ratings and raise shares to $86 and $85 targets.
- KLA-Tencor (KLAC +2.2%) is up over 4.5% since its planned merger with Lam Research terminated earlier this month.
- Previously (October 7): KLA-Tencor upgraded to Buy at Needham & Company
Thu, Oct. 20, 4:17 PM
Wed, Oct. 19, 5:35 PM
Fri, Oct. 7, 8:55 AM
- Following the cancellation of the company's (NASDAQ:KLAC) planned merger with Lam Research and in addition to resulting positive consideration out of B. Riley. & Co. (Buy, $86 target) and Cowen and Company (Outperform, $80 target).
- Needham & Company analyst Edwin Mok: "KLAC is outperforming WFE in CY16 partially due to lower DRAM mix this year, but the stock's multiple saw compression (16x to 13x) due to the deal. We believe expectations for CY17 are low as DRAM mix is likely to recover, but we see strong growth continuing on strengthened foundry demand, ramping of Gen 5 optical inspection tools, growth from other new products, and a leaner operating structure enabling better margins/profitability ahead. While the stock could see near-term pressure on investor churn, we believe it is undervalued at a CY17 P/E of 13x. KLAC historically trades at a premium to peers on structurally higher margins and ROIC, and we expect multiple expansion ahead as it delivers our growth projections."
- Price target on KLA-Tencor set at $84 (current price $71.79). Needham and Company remains positive on Lam Research (NASDAQ:LRCX) as well, restating a Buy rating and raising to a $115 target (current price $100.19).
- KLA-Tencor shares +0.86% pre-market, Lam Research +0.19%.
Thu, Oct. 6, 9:44 AM
- Termination of planned merger disclosed yesterday evening.
- On Lam Research (NASDAQ:LRCX), UBS analyst Stephen Chin reissues a Buy rating and $105 price target (current price $99). While disappointed in the development, notes firm's previous projections fully factored the company's standalone value. Sees a return to robust sales outperformance going forward.
- Lam Research shares are responding significantly (+3.05%) to the merger collapse, while KLA-Tencor (NASDAQ:KLAC) shares are hovering around mostly unchanged levels (+0.25%).
Wed, Oct. 5, 6:20 PM
- Attributed to discontinuation of consent decree by U.S. Department of Justice.
- Both companies to hold respective conference calls tomorrow.
- KLA-Tencor president and CEO Rick Wallace: "Although we are disappointed with this outcome, KLA-Tencor's performance over the past several quarters demonstrates the Company is executing our strategies at a high level and creating compelling value for the industry and for our stockholders."
- Lam Research (NASDAQ:LRCX) president and CEO Martin Anstice: "We believe that this proposed combination would have resulted in compelling benefits for our customers, employees and stockholders, as well as accelerate innovation in the broader semiconductor industry, so we are disappointed with the outcome. However, together with our customers, we have affirmed the value of closer cooperation between process and process control for new enabling solutions, for that reason, we plan to explore collaboration opportunities with KLA-Tencor around programs identified as beneficial to our customers."
- KLA-Tencor (NASDAQ:KLAC) furthermore today raises its dividend from $0.52 to $0.54 per share, effective November.
- Shares in both companies presently stable in extended trading.
- Press release (KLA-Tencor)
- Press release (Lam Research)
Wed, Oct. 5, 6:05 PM| Wed, Oct. 5, 6:05 PM
Mon, Aug. 29, 12:48 PM
- Sets $80 price target (current price $68.88).
- Analyst Timothy Arcuri sees Lam Research (LRCX +1%) a better investment resulting from a potential merger with KLA-Tencor (KLAC +1.9%), though remains positive on the latter regardless. He cites a 3 to 1 risk to reward upside ratio with or without a deal.
- A finalized agreement between the companies has been anticipated since last October, though regulatory hurdles have continued to delay the process. Arcuri further attributes possible closed-door hesitancy to the Lam Research side.
- KLA-Tencor is up around 30% since right before (October 19, 2015) the merger was proposed, with Lam Research up around 40% over the same period.
Thu, Aug. 11, 11:36 AM
- On news yesterday that Lam Research (LRCX -0.1%) and KLA-Tencor (KLAC +0.4%) are extending their timeline for a merger, Nomura Securities analyst Romit Shah downgrades the former to a Neutral rating and sets an $85 price target ($88.94 current price).
- He notes: "We find this concerning considering management's track record of managing quarterly earnings expectations. Risk/reward is not compelling, as such, we believe investors should move to the sidelines until there is certainty on the KLAC acquisition."
- He projects FY 2016 EPS of $6.45 and FY 2017 EPS of $6.80.
Wed, Aug. 10, 3:00 PM
Wed, Aug. 10, 12:51 PM
- In a press release issued today, the companies state "it has become more likely that obtaining regulatory clearances in one or more of the remaining jurisdictions may extend beyond October 20, 2016, the outside date set forth in the merger agreement."
- The deal was originally announced last October and has faced multiple hold-ups from the U.S. Department of Justice and regulatory agencies in Korea, Japan and China in the process.
- KLA-Tencor (KLAC -8.7%) and Lam Research (LRCX -4.1%) shares are trading on high volume at 3.81M vs. an average of 970,370 and 3.63M vs. an average of 2.16M, respectively.
Thu, Aug. 4, 5:47 PM
Thu, Jul. 28, 10:29 AM
Wed, Jul. 27, 5:35 PM
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