Lam Research Corp (NASDAQ:LRCX) President and CEO Timothy Archer has sold a significant portion of his company stock, according to a recent SEC filing. The transactions, which took place on June 28, 2024, involved the sale of shares with a total value exceeding $6 million.
The shares were sold at prices ranging from $1074.96 to $1085.33, highlighting a notable trading activity by the executive of the semiconductor company. Specifically, Archer sold shares in multiple transactions, which were carried out under a pre-arranged trading plan known as a Rule 10b5-1 plan, established on February 27, 2024.
The filing disclosed that Archer sold a total of 5,204 shares of common stock. The sales were executed at varying price points, with the weighted average sale prices for different batches of shares spanning from $1,074.77 to $1,085.34. The SEC document also notes that the reported amounts include shares subject to unvested restricted stock units.
After the transactions, Archer's direct ownership in Lam Research appears to remain substantial, as indicated by the reported shares owned following the sales. It’s worth noting that the reported holdings also include shares that are indirectly owned through a 401(k) and by the executive's spouse.
Investors often keep a close eye on insider transactions, such as those executed by Archer, for insights into executive sentiment regarding the company's stock. Lam Research, headquartered in Fremont, California, specializes in machinery for the semiconductor industry and is incorporated in Delaware.
The sale by the CEO comes at a time when the semiconductor industry continues to navigate through a complex market environment, with investor attention keenly focused on industry leaders and their strategic decisions.
In other recent news, Lam Research, a global supplier of semiconductor fabrication equipment, has made several significant announcements. The company's Board of Directors has approved a $10 billion share repurchase program, a substantial increase from the $1.2 billion remaining from prior authorizations. This move aligns with Lam's commitment to return between 75% and 100% of free cash flow to stockholders through dividends and share buybacks.
Meanwhile, the company has also announced a 10-for-1 stock split, scheduled to take effect after the market closes on October 2, 2024. This decision aims to make share ownership more accessible to its employees worldwide.
On the analyst front, Wells Fargo (NYSE:WFC) has maintained its Equal Weight rating on Lam Research, keeping the price target steady at $980.00. Citi has reaffirmed its Buy rating on Lam Research, maintaining a price target of $1,025.00. Deutsche Bank (ETR:DBKGn), on the other hand, has maintained a Hold rating with a $1,000.00 price target.
In international news, Lam Research is one of the American companies affected by U.S. restrictions on advanced chip shipments and chipmaking gear to China, as part of a broader strategy to control additional chipmaking technology. The U.S. is currently in talks to add 11 more Chinese chipmaking factories to an already restricted list.
InvestingPro Insights
In the wake of Lam Research Corp's CEO Timothy Archer's recent stock sale, investors may find additional context through InvestingPro insights. Notably, Lam Research has been a prominent player in the Semiconductors & Semiconductor Equipment industry, which has seen significant growth and challenges alike.
InvestingPro Tips reveal that Lam Research has raised its dividend for 10 consecutive years, indicating a commitment to shareholder returns despite market fluctuations. Moreover, the company has maintained dividend payments for 11 consecutive years, showcasing a consistent approach to its dividend policy. These aspects may reassure investors about the company's stability and long-term focus, even as the CEO adjusts his personal holdings. For those seeking to delve deeper into the company's financials and strategic outlook, InvestingPro offers an additional 20 tips at https://www.investing.com/pro/LRCX.
From a valuation standpoint, Lam Research's market capitalization stands at an impressive $138.22 billion USD. However, the company is trading at a high earnings multiple, with a P/E ratio of 38.71, which suggests a premium valuation compared to the broader market. Additionally, the P/E ratio (adjusted) for the last twelve months as of Q3 2024 is slightly lower at 37.74, reflecting adjustments that may factor into investors' valuation models.
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