Skip to Content

KLA Corp KLAC

Morningstar Rating
$698.57 +1.70 (0.24%)
View Full Chart
Unlock our analysis with Morningstar Investor

Company Report

KLA Dominates the Process Control Section of the WFE Market and Merits a Wide Moat

KLA is one of the largest providers in the world of wafer fabrication equipment for semiconductors, specializing in process control, where we expect its unmatched breadth and depth to defend and increase its market share. We believe trends toward higher complexity in chips will drive increasing demand and strong pricing for KLA’s equipment, including artificial intelligence and new technologies like high-bandwidth memory. We particularly like that KLA boasts the highest profit margins out of any WFE firm under our coverage.

Price vs Fair Value

KLAC is trading at a 37% premium.
Price
$699.73
Fair Value
$892.00
Uncertainty
High
1-Star Price
$837.30
5-Star Price
$675.00
Economic Moat
Wnyh
Capital Allocation
Xrngrsmh

Bulls Say, Bears Say

Bulls

KLA dominates the process control market within WFE, with a majority market share more than quadrupling that of its next closest competitor, Applied Materials.

Bears

KLA has a smaller budget than other giant WFE peers like Applied Materials and ASML, and risks losing market share if those firms were to invest more than it is able to.

Is it the right time to buy, sell, or hold?
Start a free trial of Morningstar Investor to unlock exclusive ratings and continuous analyst coverage to help you decide if KLAC is a good fit for your portfolio.

News

Trading Information

Previous Close Price
$696.87
Day Range
$690.01699.82
52-Week Range
$355.88729.15
Bid/Ask
$696.26 / $698.32
Market Cap
$94.47 Bil
Volume/Avg
955,176 / 929,982

Key Statistics

Price/Earnings (Normalized)
30.58
Price/Sales
9.90
Dividend Yield (Trailing)
0.79%
Dividend Yield (Forward)
0.83%
Total Yield
2.51%

Company Profile

KLA is one of the largest semiconductor wafer fabrication equipment, or WFE, manufacturers in the world. It specializes in the market segment of semiconductor process control, wherein machines inspect semiconductor wafers during research and development and manufacturing for defects and verify precise measurements. In this section of the market, KLA holds a majority share. It also has a small exposure to the etch and deposition segments of the WFE market. It counts as top customers the largest chipmakers in the world, including TSMC and Samsung.
Sector
Technology
Industry
Semiconductor Equipment & Materials
Stock Style Box
Large Growth
Total Number of Employees
15,210

Competitors

Valuation

Metric
KLAC
ASML
AMAT
Price/Earnings (Normalized)
30.5845.0825.84
Price/Book Value
30.9725.779.92
Price/Sales
9.9012.876.61
Price/Cash Flow
28.7738.9522.09
Price/Earnings
KLAC
ASML
AMAT

Financial Strength

Metric
KLAC
ASML
AMAT
Quick Ratio
1.160.881.77
Current Ratio
1.911.502.71
Interest Coverage
11.2659.2224.60
Quick Ratio
KLAC
ASML
AMAT

Profitability

Metric
KLAC
ASML
AMAT
Return on Assets (Normalized)
22.38%21.48%22.91%
Return on Equity (Normalized)
109.87%73.05%44.88%
Return on Invested Capital (Normalized)
37.13%52.22%30.44%
Return on Assets
KLAC
ASML
AMAT
See how this stock stacks up to its competitors with Morningstar Investor

Semiconductor Equipment & Materials Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
ASMLF
ASML Holding NVXbykwcqstFyhsp$382.6 Bil
ASML
ASML Holding NV ADRKhzmvwkvfgNhtdb$382.6 Bil
AMAT
Applied Materials IncPnxnxxpxtBlgrk$172.8 Bil
LRCX
Lam Research CorpYhjfszqcShjx$126.6 Bil
TOELF
Tokyo Electron LtdRlf$120.7 Bil
TOELY
Tokyo Electron Ltd ADRCdg$120.7 Bil
DISPF
Disco CorpQhbmx$39.5 Bil
DSCSY
Disco Corp ADRXlfqb$39.5 Bil
TER
Teradyne IncBffprjdlRcf$17.1 Bil

Sponsor Center