Lam Research (LRCX) — This is one of the leading manufacturers of etch products, used to etch away portions of films to create integrated circuits (IC).
On Oct. 3, with the stock trading near $51.40, I said: “This large-cap chip company is expected to see sales increase 22% in fiscal 2014, ended in June, helped by the acquisition of Novellus. And analysts look for another 7% increase in fiscal 2015. Earnings are estimated at $3.83 per share in fiscal 2014 and $4.48 in fiscal 2015.
“Last week, LRCX broke from a quadruple-top at $51 on a sharp volume spike. The trading target is $57, but investors could also buy LRCX for long-term appreciation.”
On Thursday, Goldman Sachs (GS) upgraded the stock from “neutral” to “buy,” noting: “With the memory cycle and margins now going in the right direction, we are confident Street estimates can begin to move higher in 2014.” Goldman’s price target was raised from $45 to $64.
LRCX spiked more than 6% to $55.47 on the day and closed up 1.5% at $53. I suggest a buy under price of $52, and I’m raising my trading target to $60.