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Lam Research: it is possible to buy from minimums

Lam Research: it is possible to buy from minimums

23 November 2022

The world did not think about the role of microchips until it faced their total shortage. And then it turned out that microchips are everywhere.

Lam Research is a US company that is engaged in the production of equipment for the manufacture of semiconductor chips. The company not only supplies equipment (this gives at least 60% of revenue), but also provides comprehensive maintenance (the rest of the revenue).

Manufacturers of data storage devices, including Intel, Micron, Samsung and others, and foundry players are also interested in making Lam Research work smoothly. The main markets for Lam Research products and services are Asian: China (30%), Japan (9%), as well as Taiwan and Southeast Asia.

Lam Research’s Largest clients:

  • Intel
  • Samsung
  • TSMC
  • Micron Technology
  • SK Hynix

They account for at least 55% of revenue in 2022.

With all the enormous demand of the world for semiconductor chips, Lam Research has pronounced risks that need to be taken into account. They are as follows:

  • cooling consumer demand and reducing the demand of the semiconductor market for components. While the trends are spotty, but already frightening;
  • problems of Asia in the form of coronavirus and constantly emerging restrictions and lockdowns;
  • another significant risk lies in sanctions against Yangtze, which is among the top ten priority clients of Lam Research and gives at least 6% of revenue.

At the same time, the strength remains the widespread development of 5G service, cloud solutions, metaverses, AI, and so on. This is a fundamental support, which is somehow designed for a long-term period.

In the first quarter of fiscal year 2023, Lam Research worked quite productively, there are no questions about the parameters.

The technical picture of Lam Research shares is controversial. The MACD indicator is declining in a positive zone, still holding a buy signal, but it is clearly weakening. The Stochastic oscillator declines in the neutral area and signals the start of sales. The securities may retreat to $400, from where a new wave of growth to $520 and above may form. But it will be a long-distance race.

23 November 2022
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