CNET también está disponible en español.

Ir a español

Don't show this again

Tech Industry

Lam Research leads chip-equipment stocks higher

    Chip-equipment maker Lam Research Corp. (Nasdaq: LRCX) shot up 3 5/8, or 8 percent, to a 52-week high of 48 3/8 Wednesday after ABN AMRO reiterated its "buy" recommendation on the stock and set a 12-month price target of $55 a share.

    ABN AMRO analyst David Wu said in a report he believes the wafer processing equipment industry is starting a three-year upturn.

    "Lam Research's management team has re-engineered the company over the last two years and the company's financial results are likely to surprise investors on the upside," Wu wrote in a research report.

    The move comes during this week's SEMICON West trade show in San Francisco. Analysts and chip manufacturers agree the market will make a strong recovery in the next two to three years.

    Wu raised Lam's fiscal 2000 and 2001 earnings per share of $2.30 a share and $3 a share, respectively, and says he has increased confidence that the company will beat consensus estimates for those years of $1.73 and $2.28.

    The industry's trade group, SEMI, said chip-equipment companies are predicting sales to grow 9 percent in 1999 to $23.8 billion, compared with a drop of 20.9 percent in 1998.

    This forecast is also more bullish than the November survey, in which industry executives projected a 6.7 percent growth for 1999, up from 1998 total sales of $21.8 billion.

    Lam Research has recently become very popular in the investment community as 16 of the 19 analysts following the stock maintain either a "buy" or "strong buy" recommendation.

    Its shares fell to a low of 8 3/8 in October.

    Among other widely held chip-equipment stocks, Applied Materials Inc. (Nasdaq: AMAT) was up 2 13/16 to 75 5/16; Novellus Systems Inc. (Nasdaq: NVLS) gained 4 3/16 to 74 3/8 and KLA-Tencor Corp. (Nasdaq: KLAC) shot up 2 5/8 to 69 9/16.