Lam Research upgraded to Buy from Hold at Deutsche Bank

Deutsche Bank analyst Sidney Ho upgraded Lam Research to Buy from Hold with a price target of $520, up from $400. Lam has the most memory exposure among large cap semiconductor capital equipment companies, hence its stock has suffered the most in 2022, with many memory suppliers suggesting large spending cuts and new technology export restrictions impacting China’s memory companies, Ho tells investors in a research note. While some risks to memory wafer fab equipment remain in the near term, investor expectations are already low enough and should not have a significant impact on Lam’s share price, says the analyst. Looking beyond the near term, Ho thinks memory wafer fab equipment is poised to rebound in 2024, as he believes 2023 memory spend is at unsustainably low levels. He believes Lam’s risk/reward is attractive at current share levels.