LRCX · Lam Research

The thesis

Lam Research shares look more likely to lag the S&P 500 than lead it over the next three months. The rebound from the 5 November 2026 low rests on a $25 billion buyback and a sector-wide relief rally, while the 2027 demand and policy questions behind the sell-off are still open. Applied Materials' 12 November 2026 report narrowed those questions without settling them, and Lam's own report in late January is where its 2027 spending forecast gets tested.

Applied Materials reported fiscal fourth-quarter revenue of $10.41 billion on 12 November 2026, up 53% from a year earlier, with $4.16 of non-GAAP earnings per share, per its 8-K. It guided the January quarter to $11.10 billion ± $500 million. InvestingLive reported that the midpoint topped the roughly $10.7 billion consensus but the low end fell below it, and that the company gave no explicit 2027 wafer-equipment spending figure. That is firmer near-term demand than the sell-off implied, and it counts modestly against the lag call. It does not answer the 2027 question the published case turns on.

Lam closed at $233.78 on 12 November 2026, before Applied's after-hours release, up from $185.20 on 5 November 2026. The shares remain below their 50-day and 200-day moving averages and 46.7% below the 52-week intraday high of $438.50 set on 30 June 2026.

The price reflects a cyclical slowdown more than a collapse: TIKR put Lam's forward price-to-earnings ratio at 22 times on 6 November 2026, against a five-year average of 24 times and a June 2026 peak of 57 times.

Bullish and bearish views on Lam Research Corporation

The bull case on Lam Research Corporation (LRCX), in brief: the closest peer just beat and guided higher. The bear case: Applied left 2027 unquantified.

Bull case

• The closest peer just beat and guided higher. Applied Materials' 12 November 2026 8-K showed record quarterly revenue of $10.41 billion and a January-quarter guide of $11.10 billion ± $500 million. Chief executive Gary Dickerson said Applied is on track to grow its Semiconductor Systems business more than 40% in calendar 2026.
• The buyback is large for the share count. Lam's board approved $25 billion on 5 November 2026, on top of the remaining balance of the prior program, per the company's 8-K exhibit.
• Cash generation pays for it. TIKR reported on 6 November 2026 that Lam's September-quarter free cash flow was a record $3.24 billion.
• Lam's own results are strong. Lam's 21 October 2026 8-K exhibit showed September-quarter revenue of $8.22 billion, up 22% from the June quarter, with a 52.3% gross margin and $2.19 of diluted earnings per share. Lam guided December-quarter revenue to $8.60 billion ± $400 million.
• Memory makers still signal tight supply. 24/7 Wall St. reported on 28 October 2026 that chip-equipment shares rallied after SK Hynix signaled a memory shortage lasting into 2030; Lam rose 5% that session.
• Rating changes have stopped short of downgrades. Bank of America kept a Buy rating on 10 November 2026 when it removed Lam from its US 1 list, per American Bazaar. B. Riley kept a Buy rating on 9 November 2026 with a $310 target, per Benzinga.

Bear case

• Applied left 2027 unquantified. Applied's 12 November 2026 release contained no 2027 demand figure, and InvestingLive noted the low end of both its revenue and earnings guidance sat below consensus. The question that drove the October and November sell-off is still open.
• Fewer analysts name Lam a top pick. Bank of America dropped Lam, Nvidia and Micron from its US 1 list on 10 November 2026. On 9 November 2026, Cantor Fitzgerald and HSBC named Nvidia, Micron, SanDisk, ASML and Applied Materials as top chip picks, per Benzinga, and left Lam off.
• Price targets keep falling. Needham cut its target to $290 from $390 after the October report, citing supply bottlenecks behind a slower December quarter, per Yonhap via Stockhub on 23 October 2026. B. Riley cut its target to $310 from $338 on 9 November 2026.
• Policy risk now reaches data center demand. Benzinga said on 6 November 2026 that the Democrats' midterm sweep turned a four-week slide in AI stocks into the Nasdaq 100's worst day since March 2020. Bank of America ties the trough in chip stocks to data center policy, per Benzinga on 10 November 2026.
• Rate pressure is building. October payrolls rose by 165,000 against a 65,000 estimate, per Benzinga on 6 November 2026, keeping a December Federal Reserve rate hike in play.
• China is a large and fragile share of revenue. China was 35% of Lam's September-quarter 2026 revenue. Foreign chipmakers' China plants have run on annual US licences since the Validated End-User exemption expired on 31 December 2025.

Price setup

Daily closes from Investing.com trace the slide. Lam closed at $309.56 on 12 October 2026 and $260.81 on 21 October 2026, the last close before its September-quarter report. It fell to $230.15 on 22 October 2026, recovered to $254.39 on 29 October 2026, then closed at $221.43 on 4 November 2026.

The 5 November 2026 session took the shares to a $185.20 close, the low of the sell-off. Closes of $200.44 on 6 November 2026, $221.31 on 9 November 2026, $222.39 on 10 November 2026, $235.88 on 11 November 2026 and $233.78 on 12 November 2026 followed. Adjusted daily closes put the three-month change at −29.6% as of 12 November 2026.

As of the 12 November 2026 close, the 50-day moving average is $278.92 and the 200-day moving average is $283.62. The shares sit below both, and the 50-day sits below the 200-day. The levels the case turns on are the $254.39 close of 29 October 2026 and the $260.81 close of 21 October 2026; a move back above the latter would erase the full fall since the September-quarter report. The 52-week closing low is $139.59, set on 20 November 2025.

Catalysts ahead

• 2 December 2026: Record date for Lam's $0.33 quarterly dividend, payable 6 January 2027. It confirms the capital-return program announced alongside the $25 billion buyback is proceeding on schedule.
• ~9 December 2026 (est.): Federal Reserve December rate decision. A rate hike after the 165,000-job October payrolls report would add pressure on chip valuations and support the lag call.
• ~17 December 2026 (est.): Micron fiscal first-quarter 2027 report. Micron's capital-spending plan shows whether a US memory maker matches SK Hynix's view of tight supply into 2030, which feeds Lam's etch and deposition orders.
• ~15 January 2027 (est.): TSMC 2027 capital-spending plan. The largest foundry's budget sets much of 2027 logic equipment demand.
• ~28 January 2027 (est.): Lam Research December-quarter report. Lam updates its 2027 equipment-spending forecast here; a raised forecast would show the shares leading, a cut would confirm the lag call.

What would change the view

A daily close above $261, over the $260.81 close of 21 October 2026 before Lam's September-quarter report, which would show the shares recovering their whole post-report fall and leading again. Lam raising its 2027 wafer-equipment spending forecast at its late-January report would also show them leading.

What it trades with

Lam moves with the PHLX Semiconductor Index (SOX), and further on the way down: it fell 16.3% on 5 November 2026 while the index fell about 12%, per MarketBeat. Its closest peers are Applied Materials and KLA, so Applied's 12 November 2026 report sets the group's first reaction on 13 November 2026. Bank of America removed Nvidia, Micron and Lam from its US 1 list together on 10 November 2026, which shows the market grouping Lam with AI hardware as well as with equipment makers. Memory makers' capital-spending plans (Samsung, SK Hynix, Micron) and US export-licence decisions on China act directly on Lam's orders. Changes in rate expectations hit the whole group together.