How Does the Fundamental Picture Look for Lam Research Corporation (LRCX)?

Lam Research Corporation (NASDAQ:LRCX) seems to be forming a pattern of major movements, providing only some crumbs of outlook for market participants trying to figure out its next move. Now trading with a market value of 33.05B, the company has a mix of catalysts and obstacles that spring from the nature of its operations. In light of the many issues surrounding this company, we thought it was a good time to take a close look at the numbers in order to form a realistic perspective on the fundamental picture for this stock.

Lam Research Corporation (NASDAQ:LRCX) Fundamentals That Matter

It’s generally a good idea to start with the most fundamental piece of the picture: the balance sheet. The balance sheet health of any company plays a key role in its ability to meet its obligations and maintain the faith of its investment base. For LRCX, the company currently has 4.7 billion of cash on the books, which is offset by 1.42 billion in current liabilities. The trend over time is important to note. In this case, the company’s debt has been growing. The company also has 13.66 billion in total assets, balanced by 6.86 billion in total liabilities, which should give you a sense of the viability of the company under any number of imagined business contexts.

Lam Research Corporation (LRCX) saw 1 billion in free cash flow last quarter, representing a quarterly net change in cash of 2.95 billion. Perhaps most importantly where cash movements are concerned, the company saw about 1.05 billion in net operating cash flow.

Lam Research Corporation (NASDAQ:LRCX) Revenue Growth Potential

As far as key trends that demonstrate something of the future investment potential of this stock, we need to take a closer look at the top line, first and foremost. Last quarter, the company saw 2.9 billion in total revenues. That represents a quarterly year/year change in revenues of 0.35 in sequential terms, the LRCX saw sales decline by 0.12.

But what about the bottom line? After all, that’s what really matters in the end. Lam Research Corporation (LRCX) is intriguing when broken down to its core data. The cost of selling goods last quarter was 1.49 billion, yielding a gross basic income of 1.41 billion. For shareholders, given the total diluted outstanding shares of 179.78 million, this means overall earnings per share of 4.33. Note, this compares with a consensus analyst forecast of 4.22 in earnings per share for its next fiscal quarterly report.

Is Lam Research Corporation (NASDAQ:LRCX) Valuation Attractive

Looking ahead at valuations, according to the consensus, the next fiscal year is forecast to bring about 17.51 in total earnings per share. If we consider a median price to earnings ratio on the stock, that corresponds with a stock price of 11.76. However, one should always remember: the trends are more important than the forecasts. This continues to be an interesting story, and we look forward to updating it again soon on Lam Research Corporation.

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