NasdaqGS:KLAC

Stock Analysis Report

Executive Summary

KLA Corporation designs, manufactures, and markets process control and yield management solutions for the semiconductor and related nanoelectronics industries worldwide.

Snowflake

Fundamentals

Established dividend payer with proven track record.

Risks

  • KLA has significant price volatility in the past 3 months.

Similar Companies

Share Price & News

How has KLA's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0.5%

NasdaqGS:KLAC

0.8%

US Semiconductor

1.1%

US Market


1 Year Return

46.4%

NasdaqGS:KLAC

11.3%

US Semiconductor

2.1%

US Market

KLAC outperformed the Semiconductor industry which returned 11.1% over the past year.

KLAC outperformed the Market in United States of America which returned 2% over the past year.


Share holder returns

KLACIndustryMarket
7 Day0.5%0.8%1.1%
30 Day11.1%7.7%3.7%
90 Day35.5%12.3%2.3%
1 Year50.5%46.4%13.3%11.3%4.4%2.1%
3 Year134.5%116.9%83.6%72.9%47.0%37.4%
5 Year170.4%88.8%123.2%100.4%61.6%43.8%

Price Volatility Vs. Market

How volatile is KLA's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is KLA undervalued based on future cash flows and its price relative to the stock market?

9%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

KLA's share price is below the future cash flow value, but not at a moderate discount (< 20%).

KLA's share price is below the future cash flow value, but not at a substantial discount (< 40%).


Price Based on Earnings

KLA is good value based on earnings compared to the US Semiconductor industry average.

KLA is overvalued based on earnings compared to the United States of America market.


Price Based on Expected Growth

KLA is poor value based on expected growth next year.


Price Based on Value of Assets

KLA is overvalued based on assets compared to the US Semiconductor industry average.


Next Steps

Future Growth

How is KLA expected to perform in the next 1 to 3 years based on estimates from 15 analysts?

11.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

KLA's revenue is expected to grow by 10.1% yearly, however this is not considered high growth (20% yearly).

KLA's earnings are expected to grow by 11.4% yearly, however this is not considered high growth (20% yearly).

KLA's revenue growth is expected to exceed the United States of America market average.

KLA's earnings growth is positive but not above the United States of America market average.

KLA's earnings growth is expected to exceed the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

KLA is expected to make outstanding use of shareholders’ funds in the future (Return on Equity greater than 40%).


Next Steps

Past Performance

How has KLA performed over the past 5 years?

21.4%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

KLA has delivered over 20% year on year earnings growth in the past 5 years.

KLA's 1-year earnings growth exceeds its 5-year average (46.5% vs 21.4%)

KLA's earnings growth has exceeded the US Semiconductor industry average in the past year (46.5% vs -6.2%).


Return on Equity

Whilst KLA made outstanding use of shareholders’ funds last year (Return on Equity greater than 40%), this is metric is skewed due to its high level of debt.


Return on Assets

KLA used its assets more efficiently than the US Semiconductor industry average last year based on Return on Assets.


Return on Capital Employed

KLA's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is KLA's financial position?


Financial Position Analysis

KLA is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

KLA's long term commitments exceed its cash and other short term assets.


Debt to Equity History and Analysis

KLA's level of debt (127.8%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has increased over the past 5 years (20.3% vs 127.8% today).

Debt is well covered by operating cash flow (33.7%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 16.5x coverage).


Balance Sheet

Low level of unsold assets.

Debt is covered by short term assets, assets are 1.3x debt.


Next Steps

Dividend

What is KLA's current dividend yield, its reliability and sustainability?

2.33%

Expected Dividend Yield


Dividend Yield and Payments Analysis

KLA's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.45%).

KLA's dividend is below the markets top 25% of dividend payers in United States of America (3.67%).

Dividends per share have been stable in the past 10 years.

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (2.5x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be well covered by earnings (3x coverage).


Next Steps

Management

What is the CEO of KLA's salary, the management and board of directors tenure and is there insider trading?

6.1yrs

Average management tenure


CEO

Rick Wallace (59yo)

13.7yrs

Tenure

US$12,391,300

Compensation

Mr. Richard P. Wallace, also known as Rick, has been the Chief Executive Officer of KLA-Tencor Corporation since January 01, 2006 and its President since December 31, 2008. Mr. Wallace serves on the board  ...


CEO Compensation Analysis

Rick's remuneration is about average for companies of similar size in United States of America.

Rick's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

6.1yrs

Average Tenure

56yo

Average Age

The average tenure for the KLA management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

12.3yrs

Average Tenure

67yo

Average Age

The average tenure for the KLA board of directors is over 10 years, this suggests they are a seasoned and experienced board.


Insider Trading

KLA individual insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$375,00005 Sep 19
Amichai Steimberg
EntityIndividual
Shares2,500
Max PriceUS$150.00
SellUS$1,243,90620 Aug 19
Amichai Steimberg
EntityIndividual
Shares8,962
Max PriceUS$140.00
SellUS$165,56315 May 19
Teri Little
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares1,500
Max PriceUS$110.38
SellUS$251,41814 Mar 19
Emiko Higashi
EntityIndividual
Role
Member of the Board of Directors
Director
Shares2,141
Max PriceUS$117.43

Ownership Breakdown


Management Team

  • Rick Wallace (59yo)

    President

    • Tenure: 13.7yrs
    • Compensation: US$12.39m
  • Virendra Kirloskar (56yo)

    Senior VP & Chief Accounting Officer

    • Tenure: 11.5yrs
    • Compensation: US$1.31m
  • Benjamin Tsai (60yo)

    CTO & Executive VP of Corporate Alliances

    • Tenure: 25.7yrs
    • Compensation: US$1.88m
  • Brian Trafas (56yo)

    Executive Vice President of Global Customer Organization

    • Tenure: 4.4yrs
    • Compensation: US$3.16m
  • Ted Lockwood

    Senior Director of Investor Relations

    • Tenure: 0yrs
  • Bren Higgins (49yo)

    Executive VP & CFO

    • Tenure: 6.1yrs
    • Compensation: US$4.02m
  • Ahmad Khan (45yo)

    Executive Vice President of Global Products Group

    • Tenure: 4.1yrs
    • Compensation: US$4.17m
  • Teri Little (55yo)

    Executive VP

    • Tenure: 2.1yrs
    • Compensation: US$1.84m
  • Oreste Donzella

    Senior VP of Global Customer Solution & Chief Marketing Officer

    • Tenure: 0yrs
  • Becky Howland

    Senior Director of Corporate Communications

    • Tenure: 0yrs

Board Members

  • John Dickson (73yo)

    Director

    • Tenure: 12.3yrs
    • Compensation: US$317.23k
  • Ned Barnholt (75yo)

    Non-Executive Chairman

    • Tenure: 12.9yrs
    • Compensation: US$435.83k
  • Ken Levy (75yo)

    Founder & Chairman Emeritus

    • Tenure: 12.9yrs
    • Compensation: US$356.35k
  • Rick Wallace (59yo)

    President

    • Tenure: 13.7yrs
    • Compensation: US$12.39m
  • Bob Calderoni (59yo)

    Director

    • Tenure: 12.5yrs
    • Compensation: US$347.23k
  • Emiko Higashi (61yo)

    Director

    • Tenure: 8.8yrs
    • Compensation: US$309.73k
  • Kevin Kennedy (64yo)

    Director

    • Tenure: 12.3yrs
    • Compensation: US$327.23k
  • Kiran Patel (71yo)

    Director

    • Tenure: 11.3yrs
    • Compensation: US$317.23k
  • Bob Rango (61yo)

    Director

    • Tenure: 5.7yrs
    • Compensation: US$307.23k
  • Gary Moore (70yo)

    Director

    • Tenure: 5.7yrs
    • Compensation: US$307.23k

Company Information

KLA Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: KLA Corporation
  • Ticker: KLAC
  • Exchange: NasdaqGS
  • Founded: 1975
  • Industry: Semiconductor Equipment
  • Sector: Semiconductors
  • Market Cap: US$24.078b
  • Shares outstanding: 159.26m
  • Website: https://www.kla.com

Number of Employees


Location

  • KLA Corporation
  • One Technology Drive
  • Milpitas
  • California
  • 95035
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
KLACNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDOct 1980
KLADB (Deutsche Boerse AG)YesCommon StockDEEUROct 1980
KLACWBAG (Wiener Boerse AG)YesCommon StockATEUROct 1980

Biography

KLA Corporation designs, manufactures, and markets process control and yield management solutions for the semiconductor and related nanoelectronics industries worldwide. The company offers chip and wafer m ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/09/16 23:37
End of Day Share Price2019/09/16 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.