KLA (NASDAQ:KLAC) Shares Gap Up – Should You Buy?

KLA Corporation (NASDAQ:KLAC) shares gapped up prior to trading on Thursday . The stock had previously closed at $221.18, but opened at $239.02. KLA shares last traded at $244.7060, with a volume of 2,361,454 shares traded.

Analysts Set New Price Targets

Several research firms recently commented on KLAC. Rothschild & Co Redburn increased their target price on shares of KLA from $140.00 to $186.50 and gave the company a “neutral” rating in a report on Tuesday, May 12th. Morgan Stanley upped their price target on shares of KLA from $190.00 to $274.00 and gave the company an “overweight” rating in a research report on Monday. Bank of America raised their price objective on KLA from $210.00 to $317.00 and gave the company a “buy” rating in a research note on Tuesday, June 23rd. Barclays reiterated an “overweight” rating and issued a $2,250.00 price objective (up from $1,700.00) on shares of KLA in a report on Thursday, June 11th. Finally, UBS Group reissued a “neutral” rating and issued a $218.00 target price (up from $177.00) on shares of KLA in a research note on Tuesday, June 9th. Twenty research analysts have rated the stock with a Buy rating and ten have given a Hold rating to the company. According to MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $280.34.

KLA Stock Performance

The firm has a market cap of $307.77 billion, a P/E ratio of 66.61, a price-to-earnings-growth ratio of 2.38 and a beta of 1.41. The company has a current ratio of 3.03, a quick ratio of 2.11 and a debt-to-equity ratio of 1.01. The business’s fifty day simple moving average is $214.09 and its 200-day simple moving average is $172.21.

KLA (NASDAQ:KLAC) last announced its earnings results on Wednesday, April 29th. The semiconductor company reported $9.40 EPS for the quarter, beating analysts’ consensus estimates of $0.92 by $8.48. KLA had a return on equity of 91.89% and a net margin of 35.66%.The company had revenue of $3.42 billion during the quarter, compared to the consensus estimate of $3.37 billion. During the same quarter in the prior year, the company earned $0.84 earnings per share. The firm’s revenue for the quarter was up 11.5% on a year-over-year basis. KLA has set its Q4 2026 guidance at 8.870-10.870 EPS. As a group, sell-side analysts expect that KLA Corporation will post 3.71 earnings per share for the current year.

KLA Cuts Dividend

The company also recently declared a quarterly dividend, which was paid on Tuesday, June 2nd. Investors of record on Monday, May 18th were paid a $0.23 dividend. This represents a $0.92 annualized dividend and a yield of 0.4%. The ex-dividend date of this dividend was Monday, May 18th. KLA’s dividend payout ratio is presently 26.06%.

KLA announced that its Board of Directors has authorized a stock buyback program on Thursday, March 12th that permits the company to repurchase $7.00 billion in outstanding shares. This repurchase authorization permits the semiconductor company to purchase up to 3.6% of its shares through open market purchases. Shares repurchase programs are usually an indication that the company’s leadership believes its shares are undervalued.

Insider Buying and Selling at KLA

In related news, EVP Mary Beth Wilkinson sold 14,392 shares of the stock in a transaction dated Wednesday, July 1st. The shares were sold at an average price of $285.30, for a total value of $4,106,037.60. Following the completion of the transaction, the executive vice president directly owned 53,367 shares in the company, valued at $15,225,605.10. This trade represents a 21.24% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CFO Bren D. Higgins sold 27,701 shares of KLA stock in a transaction dated Thursday, July 2nd. The shares were sold at an average price of $265.69, for a total transaction of $7,359,878.69. Following the transaction, the chief financial officer directly owned 263,472 shares of the company’s stock, valued at approximately $70,001,875.68. This trade represents a 9.51% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last 90 days, insiders sold 132,333 shares of company stock valued at $29,547,170. 91.48% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On KLA

A number of hedge funds and other institutional investors have recently bought and sold shares of the business. Basepoint Wealth LLC bought a new position in shares of KLA during the fourth quarter valued at approximately $32,000. Triumph Capital Management bought a new stake in shares of KLA in the 3rd quarter worth approximately $40,000. Hilton Head Capital Partners LLC purchased a new stake in shares of KLA in the 4th quarter worth approximately $41,000. Aventura Private Wealth LLC bought a new position in KLA during the 4th quarter valued at approximately $55,000. Finally, Nemes Rush Group LLC increased its position in KLA by 17.1% during the 4th quarter. Nemes Rush Group LLC now owns 48 shares of the semiconductor company’s stock valued at $58,000 after buying an additional 7 shares in the last quarter. Hedge funds and other institutional investors own 86.65% of the company’s stock.

KLA Company Profile

KLA is a provider of process control and yield management solutions for the semiconductor and related microelectronics industries. The company designs and manufactures equipment, software and services used by chipmakers to analyze and control manufacturing processes, detect defects, measure critical dimensions and improve yield across wafer fabrication, photomask and packaging operations. KLA’s offerings are aimed at enabling production of advanced logic, memory, and specialty devices at progressively smaller technology nodes and more complex package structures.

Its product portfolio includes optical and e-beam inspection systems, metrology tools for critical dimension and film measurement, mask and reticle inspection platforms, as well as enterprise software and data analytics that aggregate process data and drive automated process control.