Is KLA Corporation Stock Underperforming the Dow?
/KLA%20Corp_%20logo%20on%20phone-by%20Piotr%20Swat%20via%20Shutterstock.jpg)
KLA Corporation (KLAC), headquartered in Milpitas, California, designs, manufactures, and markets process control, process-enabling, and yield management solutions for the semiconductor and related electronics industries worldwide. With a market cap of $100.1 billion, the company offers surface profilers, nanomechanical testers, chips, and semiconductor assembly solutions.
Companies worth $10 billion or more are generally described as “large-cap stocks,” and KLAC perfectly fits that description, with its market cap exceeding this mark, underscoring its size, influence, and dominance within the semiconductor equipment & materials industry. KLAC is a market leader in semiconductor process control, known for innovative solutions that drive high volume production efficiency. With a strong financial performance despite economic challenges, the company's reputation for quality and reliability sets it apart from competitors.
Despite its notable strength, KLAC slipped 14.9% from its 52-week high of $896.32, achieved on Jul. 11, 2024. Over the past three months, KLAC stock gained 7.6%, outperforming the Dow Jones Industrials Average’s ($DOWI) 3.5% dip during the same time frame.
In the longer term, shares of KLAC rose 21% on a YTD basis, outperforming DOWI’s YTD marginal losses. However, the stock climbed marginally over the past 52 weeks, underperforming DOWI’s 9.4% returns over the last year.
To confirm the bullish trend, KLAC has been trading above its 50-day and 200-day moving averages since early May.
On Apr. 30, KLAC shares closed up more than 2% after reporting its Q3 results. Its adjusted EPS of $8.41 beat Wall Street expectations of $8.06. The company’s revenue was $3.1 billion, beating Wall Street forecasts of $3 billion. For Q4, KLAC expects adjusted EPS to range from $7.75 to $9.31.
KLAC’s rival, Applied Materials, Inc. (AMAT) shares lagged behind the stock, with a 3.3% loss on a YTD basis and 26.9% decline over the past 52 weeks.
Wall Street analysts are moderately bullish on KLAC’s prospects. The stock has a consensus “Moderate Buy” rating from the 25 analysts covering it, and the mean price target of $796.38 suggests a potential upside of 4.5% from current price levels.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.