Don’t Miss Out: Jim Cramer’s 10 Key Stocks to Watch

6. Lam Research Corporation (NASDAQ:LRCX)

Number of Hedge Fund Investors: 84

In other news about chips, Jim Cramer said that Citi has reduced its price targets for Lam Research Corporation (NASDAQ:LRCX), which was once a highly regarded semiconductor equipment manufacturer.

“In other news about chips, Citi has reduced its price targets for Lam Research, which was once a highly regarded semiconductor equipment manufacturer.”

Lam Research Corporation (NASDAQ:LRCX)’s positive outlook is based on its strong earnings, leadership in semiconductor manufacturing, and growing demand for advanced technology nodes. In its latest earnings report for Q4 2023, Lam Research Corporation (NASDAQ:LRCX) reported revenues of $4.2 billion, showing significant year-over-year growth driven by high demand for its semiconductor equipment.

As a key provider of equipment for making semiconductor devices, especially for advanced nodes, Lam Research Corporation (NASDAQ:LRCX) is well-positioned as the industry moves toward smaller geometries, making its technology essential for manufacturers. The increasing global demand for semiconductors, driven by trends in AI, 5G, and IoT, boosts Lam Research Corporation (NASDAQ:LRCX)’s growth prospects, as its products are critical for producing next-generation chips.

Lam Research Corporation (NASDAQ:LRCX)’s investments in research and development, particularly in areas like atomic layer deposition (ALD) and etch processes, highlight its commitment to advancing technology for future chips. Recent announcements about expansion plans and new product innovations in response to market needs further strengthen a positive outlook on Lam Research Corporation (NASDAQ:LRCX)’s growth potential.

Artisan Select Equity Fund stated the following regarding Lam Research Corporation (NASDAQ:LRCX) in its Q2 2024 investor letter:

“The top contributors to performance for the quarter were Alphabet, Lam Research Corporation (NASDAQ:LRCX) and Elevance. Lam Research shares rose 10% during the quarter and are up 67% over the past year, primarily due to optimism around the pending investment cycle in semiconductor capital expenditures. Lam is one of the largest equipment manufacturers used to make semiconductor chips.

This equipment, commonly referred to as WFE (wafer fabrication equipment), is expected to experience significant growth due to a combination of a cyclical rebound in memory chips and growing demand for new AI-related chips. Lam’s product portfolio is particularly well positioned to benefit from both trends and should grow even faster than the overall market. Its shares now trade at ~30X prior peak earnings, which suggests this dynamic is well understood by the market and is mostly priced in.”