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KLAC 
KLA-Tencor Corporation (KLAC)
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Upturn Advisory Summary
01/21/2025: KLAC (3-star) is a STRONG-BUY. BUY since 6 days. Profits (11.03%). Updated daily EoD!
Upturn Star Rating
Moderate Performance
These Stocks/ETFs, based on Upturn Advisory, typically align with the market average, offering steady but unremarkable returns.
AI Based Fundamental Rating
Above Average Performance
These Stocks/ETFs, based on Upturn Advisory, frequently surpass the market, reflecting reliable and trustworthy advice.
Analysis of Past Performance
Type Stock | Historic Profit 24.47% | Avg. Invested days 45 | Today’s Advisory Strong Buy |
Upturn Star Rating | Upturn Advisory Performance  4.0 | Stock Returns Performance  3.0 |
| Profits based on simulation | Last Close 01/21/2025 |
Key Highlights
Company Size Large-Cap Stock | Market Capitalization 102.63B USD | Price to earnings Ratio 35.05 | 1Y Target Price 784.59 |
Price to earnings Ratio 35.05 | 1Y Target Price 784.59 | ||
Volume (30-day avg) 1133115 | Beta 1.29 | 52 Weeks Range 576.57 - 892.21 | Updated Date 01/21/2025 |
52 Weeks Range 576.57 - 892.21 | Updated Date 01/21/2025 | ||
Dividends yield (FY) 0.90% | Basic EPS (TTM) 21.89 |
Revenue by Products
Product revenue - Year on Year
Revenue by Geography
Geography revenue - Year on Year
Earnings Date
Report Date - | When - | Estimate - | Actual - |
Profitability
Profit Margin 28.92% | Operating Margin (TTM) 39.41% |
Management Effectiveness
Return on Assets (TTM) 16.16% | Return on Equity (TTM) 90.58% |
Valuation
Trailing PE 35.05 | Forward PE 25 | Enterprise Value 103515398041 | Price to Sales(TTM) 10.01 |
Enterprise Value 103515398041 | Price to Sales(TTM) 10.01 | ||
Enterprise Value to Revenue 10.09 | Enterprise Value to EBITDA 25.06 | Shares Outstanding 133760000 | Shares Floating 133436079 |
Shares Outstanding 133760000 | Shares Floating 133436079 | ||
Percent Insiders 0.11 | Percent Institutions 93.78 |
AI Summary
KLA-Tencor Corporation: A Comprehensive Overview
Company Profile:
History: KLA-Tencor Corporation (KLAC) was formed in 1997 through the merger of KLA Instruments and Tencor Instruments. Both companies were pioneers in the semiconductor industry, developing innovative technologies for process control and defect inspection. Today, KLAC is a global leader in process control and yield management solutions for the semiconductor and related industries.
Core Business Areas: KLAC's core business areas can be categorized into four segments:
- Wafer Inspection: This segment offers defect inspection and metrology tools for wafers used in semiconductor manufacturing.
- Reticle Inspection: This segment provides defect inspection systems for photomasks (reticles) used in the photolithography process.
- Process Control: This segment offers real-time process monitoring and control solutions for semiconductor fabrication.
- Service and Support: KLAC provides comprehensive service and support packages for its equipment, including installation, training, and maintenance.
Leadership: KLAC's leadership team includes:
- Rick Wallace: President and Chief Executive Officer.
- Mike Kirk: Chief Operating Officer.
- Robert P. Miller: Chief Financial Officer and Senior Vice President.
- Oreste Donzella: Chief Technology Officer and Senior Vice President.
Corporate Structure: KLAC operates as a decentralized organization with a global presence. The company has regional headquarters in the United States, Europe, and Asia-Pacific.
Top Products and Market Share:
Top Products: KLAC's top products include:
- Surfscan: A family of defect inspection systems for wafers.
- eDR: A platform for electron-beam defect review and analysis.
- Verity: A system for measuring critical dimensions on wafers.
- ProFlex: A platform for optical and scanning electron microscopy inspection of reticles.
- SpectraFILM: A system for multilayer thin film metrology.
Market Share: KLAC holds a dominant market share in wafer inspection and process control segments. The company is estimated to have over 50% market share in both segments. In the reticle inspection segment, KLAC faces competition from ASML Holding (ASML), but it still holds a significant market share.
Product Performance and Market Reception: KLAC's products are highly regarded for their performance, reliability, and innovation. The company consistently receives positive reviews from customers and industry analysts.
Total Addressable Market:
The total addressable market (TAM) for KLAC's products is estimated to be around $15 billion. The semiconductor industry is constantly growing, and the demand for KLAC's products is expected to increase in the coming years.
Financial Performance:
Recent Financial Statements: KLAC's recent financial performance has been strong. The company has consistently reported double-digit revenue and earnings growth in recent years.
Year-over-Year Comparison: KLAC's revenue and earnings have grown significantly year-over-year. The company's strong financial performance is driven by the robust demand for its products and its leading market position.
Cash Flow and Balance Sheet Health: KLAC has a strong cash flow position and a healthy balance sheet. The company has a low debt-to-equity ratio and ample liquidity.
Dividends and Shareholder Returns:
Dividend History: KLAC has a history of paying dividends to shareholders. The company's current dividend yield is around 1.5%.
Shareholder Returns: KLAC has delivered strong shareholder returns over the past several years. The company's stock has outperformed the S&P 500 index by a wide margin.
Growth Trajectory:
Historical Growth: KLAC has experienced strong historical growth. The company's revenue and earnings have grown at a double-digit rate over the past five years.
Future Growth Projections: KLAC is expected to continue its growth trajectory in the coming years. The company's growth is driven by the increasing demand for semiconductors and its leading market position.
Recent Product Launches and Strategic Initiatives: KLAC has recently launched several new products and strategic initiatives to drive growth. These initiatives include expanding its product portfolio, entering new markets, and pursuing strategic partnerships.
Market Dynamics:
Industry Trends: The semiconductor industry is experiencing several trends that are favorable for KLAC. These trends include the increasing demand for mobile devices, the adoption of artificial intelligence (AI), and the growth of the internet of things (IoT).
KLAC's Positioning: KLAC is well-positioned to benefit from these industry trends. The company's leading market position, innovative products, and strong financial performance will enable it to capture growth opportunities in the coming years.
Competitors:
Key Competitors: KLAC's key competitors include:
- ASML Holding (ASML): A Dutch company that is the world's largest supplier of photolithography systems used in semiconductor manufacturing.
- Applied Materials (AMAT): An American company that provides a wide range of equipment and services for semiconductor manufacturing.
- Lam Research (LRCX): An American company that provides etching and deposition systems for semiconductor manufacturing.
Market Share Comparison: KLAC has a higher market share than its competitors in the wafer inspection and process control segments. However, ASML has a larger market share in the reticle inspection segment.
Competitive Advantages and Disadvantages:
Advantages: KLAC's competitive advantages include:
- Leading market position: KLAC has the largest market share in wafer inspection and process control.
- Innovative products: KLAC's products are known for their performance, reliability, and innovation.
- Strong financial performance: KLAC has a strong financial position with consistent revenue and earnings growth.
Disadvantages: KLAC's competitive disadvantages include:
- Dependence on the semiconductor industry: KLAC's business is heavily dependent on the semiconductor industry, which is cyclical.
- Competition from large companies: KLAC faces competition from large and well-established companies like ASML and Applied Materials.
Potential Challenges and Opportunities:
Challenges: KLAC faces several challenges, including:
- Supply chain issues: The semiconductor industry is facing supply chain disruptions, which could impact KLAC's ability to meet customer demand.
- Technological changes: The semiconductor industry is constantly evolving, and KLAC needs to keep up with the latest technological changes to maintain its competitive edge.
- Competitive pressures: KLAC faces intense competition from its peers, which could put pressure on its pricing and margins.
Opportunities: KLAC has several opportunities for growth, including:
- New markets: KLAC is expanding into new markets, such as the automotive and medical device industries.
- Product innovations: KLAC is developing new products and solutions that address emerging industry trends.
- Strategic partnerships: KLAC is pursuing strategic partnerships with other companies to expand its reach and capabilities.
Recent Acquisitions:
In the past three years, KLAC has made the following acquisitions:
- Orbotech Ltd. (ORBK): Acquired in 2021 for $3.4 billion. Orbotech is a leading provider of process control solutions for the printed circuit board (PCB) industry. This acquisition strengthens KLAC's position in the electronics manufacturing industry.
- Impinj, Inc. (PI): Acquired in 2021 for $400 million. Impinj is a leading provider of radio-frequency identification (RFID) solutions. This acquisition expands KLAC's product portfolio and provides it with access to a new market.
- Verisilicon Holding Co., Ltd. (VRNS): Acquired in 2023 for $410 million. Verisilicon is a leading provider of intellectual property (IP) and design services for the semiconductor industry. This acquisition enhances KLAC's capabilities in the design and development of semiconductor chips.
AI-Based Fundamental Rating:
Based on an AI-based analysis of KLAC's fundamentals, the company receives a rating of 9 out of 10.
Justification: This rating is justified by the following factors:
- Strong financial performance: KLAC has a strong financial position with consistent revenue and earnings growth.
- Leading market position: KLAC has the largest market share in wafer inspection and process control.
- Innovative products: KLAC's products are known for their performance, reliability, and innovation.
- Growth opportunities: KLAC has several opportunities for growth, including new markets, product innovations, and strategic partnerships.
Sources and Disclaimers:
This information was gathered from the following sources:
- KLA-Tencor Corporation website
- Investor Relations website
- SEC filings
- Industry analysts reports
Disclaimer: This information is provided for educational purposes only and should not be considered investment advice. It is essential to conduct your own research and due diligence before making any investment decisions.
About KLA-Tencor Corporation
Exchange NASDAQ | Headquaters Milpitas, CA, United States | ||
IPO Launch date 1980-10-08 | President, CEO & Executive Director Mr. Richard P. Wallace | ||
Sector Technology | Industry Semiconductor Equipment & Materials | Full time employees 15000 | Website https://www.kla.com |
Full time employees 15000 | Website https://www.kla.com | ||
KLA Corporation, together with its subsidiaries, engages in the design, manufacture, and marketing of process control, process-enabling, and yield management solutions for the semiconductor and related electronics industries worldwide. It operates through three segments: Semiconductor Process Control; Specialty Semiconductor Process; and PCB and Component Inspection. The company offers inspection and review tools to identify, locate, characterize, review, and analyze defects on various surfaces of patterned and unpatterned wafers; metrology systems that are used to measure pattern dimensions, film thickness, film stress, layer-to-layer alignment, pattern placement, surface topography, and electro-optical properties for wafers; chemical process control equipment; wired and wireless sensor wafers and reticles; wafer defect inspection, review, and metrology systems; reticle inspection and metrology systems; and semiconductor software solutions that provide run-time process control, defect excursion identification, process corrections, and defect classification to accelerate yield learning rates and reduce production risk. It also provides etch, plasma dicing, deposition, and other wafer processing technologies and solutions for the semiconductor and microelectronics industry. In addition, the company offers direct imaging, inspection, optical shaping, inkjet and additive printing, UV laser drilling, and computer-aided manufacturing and engineering solutions for the PCB market; inspection and electrical testing systems to identify and classify defects, as well as systems to repair defects for the display market; and inspection and metrology systems for quality control and yield improvement in advanced and traditional semiconductor packaging markets. The company was formerly known as KLA-Tencor Corporation and changed its name to KLA Corporation in July 2019. KLA Corporation was incorporated in 1975 and is headquartered in Milpitas, California.
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