Lam Research also provides SPEED gapfill high-density plasma chemical vapor deposition products and Striker single-wafer atomic layer deposition products that provide multiple dielectric film solutions. In addition, the company offers Flex for dielectric etch applications, Kiyo for conductor etch applications, Syndion for through-silicon via etch applications and Versys metal products for metal etch processes.
Lam Research’s Coronus bevel clean products enhance die yield. Its Da Vinci, DV-Prime, EOS and SP address a range of wafer cleaning applications, and Metryx mass metrology systems offer high precision in-line mass measurement in semiconductor wafer manufacturing.
The analysts love the semiconductor equipment sector for 2021 and said this:
Solid beat and raise, 2021 wafer fab equipment to grow 15%+ ahead of our 10% estimate to a high $60 billion-$70 billion level which is already at 2023 target. We like the 2020 share gains which grew 27% versus WFE up 15-20%; compelling valuation at 18x calendar year 2022 estimated EPS versus semiconductors 22x; solid free-cash-flow return (100%+).
Investors in Lam Research stock receive a 1.02% dividend. The $590 BofA Securities price target was raised to $600. The $484.17 consensus target is less than Thursday’s close at $507.35 per share.
This is a more conservative way for investors to participate in the massive cloud growth and utilization. Microsoft Inc. (NASDAQ: MSFT) manufactures, licenses, and supports a wide range of software products. The company has transformed its business model from a component-driven model (PC, server) to one driven by the need for cloud capacity.
Many Wall Street analysts agree that Microsoft has become a clear number two in the public or hyper-scale cloud infrastructure market with Azure, which is the company’s cloud computing platform offerings, and which continues growing at triple-digit levels. Some have flagged Azure as the biggest rival to Amazon’s AWS service.
Some analysts maintain that Microsoft is discounting Azure for large enterprises, such that Azure may be cheaper than AWS for larger users. The cloud was big in 2020 earnings reports, and it will remain a growing part of the software giant’s earnings profile.
The legacy software giant posted outstanding results and the analysts said this:
Microsoft reported strong second fiscal quarter results with upside from Azure momentum (+$700 million to our estimate) and Xbox (+$900 million) from new console launch. Commentary on Azure deals >$10 million and enterprise resource planning deployments at large organizations underscore momentum in enterprise for mission critical workloads.
Shareholders receive a 0.93% dividend. The BofA Securities raised its $256 price target to $285, well above the $243.33 consensus target. Microsoft stock closed at $238.93 on Thursday, after close to a 3% gain on the day.
Note that while these top companies are hitting on all cylinders, the market is very rich and, as we saw earlier this week, could be ready for a sizable shakeout correction. Given that, it may make sense to scale buy shares over a few months, just in case the move down is sooner rather than later.
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