KLA (NASDAQ:KLAC) closed the latest trading day at $892.35, indicating a +1.99% change from the previous session’s end. The stock’s performance was ahead of the S&P 500’s daily gain of 1.02%. At the same time, the Dow added 1.09%, and the tech-heavy Nasdaq gained 1.18%.
Heading into today, shares of the maker of equipment for manufacturing semiconductors had gained 9.61% over the past month, outpacing the Computer and Technology sector’s gain of 8.46% and the S&P 500’s gain of 4.44% in that time.
The investment community will be paying close attention to the earnings performance of KLA in its upcoming release. The company is slated to reveal its earnings on July 24, 2024. In that report, analysts expect KLA to post earnings of $6.08 per share. This would mark year-over-year growth of 12.59%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.5 billion, up 6.34% from the year-ago period.
Investors should also take note of any recent adjustments to analyst estimates for KLA. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, there’s been no change in the Zacks Consensus EPS estimate. KLA is currently a Zacks Rank #3 (Hold).
Looking at valuation, KLA is presently trading at a Forward P/E ratio of 31.06. This expresses a premium compared to the average Forward P/E of 20.39 of its industry.
We can also see that KLAC currently has a PEG ratio of 3.46. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. As of the close of trade yesterday, the Electronics – Miscellaneous Products industry held an average PEG ratio of 2.78.
The Electronics – Miscellaneous Products industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 194, which puts it in the bottom 24% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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