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Friday, September 25, 2020

KLA Corporation (NASDAQ:KLAC) is Waving the Bull Flag

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The KLA Corporation (KLAC) shares are trading at higher $200.93 and the avg recommendation for the stock is Moderate Buy. while the current analyst price target stands at $184.29.

To add more color to this target, the company’s high over the last year is $207.78 and the low is $110.19. Over the last 52 weeks, KLAC is down -3.30% while the S&P 500 is up 1.30%. The catalyst for this interesting swing was the company’s recent earnings report.

A Notable Earnings Report

In the last quarter, KLAC reported a profit of $833.81 million. KLA Corporation also saw revenues increase to $1.42 billion. In addition, KLAC has free cash flow of $1.22 billion as of 03-2020. The company’s EBITDA came in at $514.6 million which compares well with its peers.

KLAC booked profit margins of 18.30%, its Return on Equity (ROE) is 39.80%, and its Return on Assets is 11.30%. All told, it is clear that, KLAC needs to be on your watchlist.

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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. KLAC has a short ratio of 2.46 and outstanding shares of 156.07M.

Company Outlook

KLAC has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 1.11 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at 6.41. KLA Corporation KLAC also noted assets of $8.85 billion at the end of the last quarter. Investors should also keep an eye on sector updates as KLAC has historically followed its peers on positive news.

All told, KLA Corporation KLAC has strung together solid data and demonstrated underlying fundamentals. At its current valuation, KLAC represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.

KLA Corporation KLAC is now commanding a market cap of 31.36B and a float of 154.66M. KLAC is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of KLAC stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in KLAC, either long or short, and we have not been compensated for this article.

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