Here's Why KLA-Tencor (KLAC) Should Be In Your Portfolio
Zacks Investment Research | Oct 16, 2017 08:56AM ET
KLA-Tencor Corporation (NASDAQ:KLAC) is currently a well-performing stock and an increase in share price and strong fundamentals signal its bullish run. Therefore, if you haven’t taken advantage of the share price appreciation yet, it’s time you add the stock to your portfolio.
The company has the potential to carry on the momentum. Here are a few reasons why the stock is worth a buy.
An Outperformer
A look at the company’s price trend reveals that the stock has had an impressive run on the bourse year to date. KLA-Tencor has gained 33.8%, significantly outperforming the S&P 500's gain of 15.0%.
Solid Rank & VGM Score
KLA-Tencor currently carries a Zacks Rank #1 (Strong Buy) and has a VGM Score of B. Our research shows that stocks with a VGM Score of A or B when combined with a Zacks Rank #1 (Strong Buy) or #2 offer the best investment opportunities for investors. Thus, the stock appears to be a convincing investment proposition at the moment.
Northward Estimate Revisions
For the upcoming quarter, two estimates have moved north over the past 60 days against no southward revisions, reflecting analysts’ confidence in the company. Over the same period, the Zacks Consensus Estimate for the current fiscal year increased 0.7%.
Strong Growth Prospects
The company’s Zacks Consensus Estimate for fiscal 2018 earnings of $6.80 reflects year-over-year growth of 14.41%. Moreover, earnings are expected to register 6.97% growth in fiscal 2019.
Solid Growth Drivers
KLA is one of the leading suppliers of inspection and metrology products and services.
Notably, the company continues to focus on innovation and is expected to benefit from its new product-development strategy. KLA has introduced a number of new front-end defect inspection products that are expected to augment its existing portfolio.
Moreover, we expect strong demand for more efficient manufacturing processes and preference for mobile to work in favor of the company. The technical complexity of manufacturing semiconductors and increasingly challenging yield issues remain revenue drivers for this leading manufacturer of process control equipment.
Moreover, accelerated process control spending across foundry, memory and logic players through 2017 and beyond will enable KLA to deliver stronger results.
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KLA-Tencor Corporation Price and Consensus
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