Update shared on 17 Nov 2025
Fair value Increased 1.21%KLA's analyst price target has been revised upward, increasing by $15 to $1,287. Analysts cite robust quarterly results, enhanced positioning in AI and DRAM markets, and improving profit margins as key factors supporting a positive outlook.
Analyst Commentary
Recent analyst notes on KLA reflect a broad range of perspectives, highlighting both strong opportunities and ongoing risks that could shape the company's future performance.
Bullish Takeaways
- Bullish analysts highlight KLA's robust September quarter results, which exceeded expectations and provided confidence in the company's near-term revenue trajectory.
- Positive outlooks stem from KLA's improving position in the AI and DRAM markets, as well as an anticipated increase in process control market intensity due to technology transitions.
- Several analysts are optimistic about KLA's relative insulation from geopolitical risks and changing sales mix, especially compared to peers with higher China exposure.
- Increased price targets reflect expectations for further margin expansion and potential benefits from rising artificial intelligence compute investments and broader U.S. manufacturing initiatives.
Bearish Takeaways
- Bearish analysts remain cautious about high expectations for wafer fab equipment growth in 2026. They suggest the outlook may be overly optimistic and could create challenges for future valuation.
- Exposure to market volatility stemming from potential U.S. policy changes regarding domestic versus foreign chip manufacturing adds uncertainty for the sector and indirectly for KLA.
- Despite strong recent results, some analysts are maintaining neutral or equal-weight ratings, citing a balanced risk-reward profile at current valuation levels.
What's in the News
- The Board of Directors approved comprehensive amendments to KLA's By-laws, enhancing shareholder proposal procedures, updating governance practices, and clarifying rules. (Key Developments)
- KLA completed a significant share repurchase tranche by buying back 622,500 shares for $559.62 million between July and September 2025. The ongoing buyback program has now retired over 18.3 million shares. (Key Developments)
- The company issued guidance for the second quarter ending December 2025, anticipating total revenues of $3.225 billion, plus or minus $150 million, and GAAP diluted EPS of $8.46, plus or minus $0.78. (Key Developments)
Valuation Changes
- Consensus Analyst Price Target has risen from $1,271.88 to $1,287.27, reflecting a modest upward adjustment.
- Discount Rate increased slightly from 10.25% to 10.68%, which indicates a higher perceived risk or required return.
- Revenue Growth forecast has edged up from 8.41% to 8.57%.
- Net Profit Margin improved marginally, moving from 36.04% to 36.10%.
- Future P/E ratio estimate has increased from 37.04x to 38.31x, suggesting higher earnings expectations or valuation multiples.
Disclaimer
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