Lam Research Corporation (LRCX) vs Teradyne, Inc. (TER)

Lam Research Corporation and Teradyne, Inc. are both Semiconductor Equipment & Materials companies. Lam Research Corporation is the larger, with a market value of $390.4B against $62.4B — 6.3× the size. Teradyne, Inc. trades at the lower P/E: 54.3× against 54.4×. Teradyne, Inc. grew revenue faster over the last twelve months: 57.9% against 26.0%. Lam Research Corporation has the higher net margin (31.3% vs 25.8%) and the higher return on invested capital (48.2% vs 27.0%). Both pay a dividend; Lam Research Corporation yields more (0.90% vs 0.47%). Across the 22 metrics below, Lam Research Corporation leads on 12 and Teradyne, Inc. on 10.

Valuation

Metric LRCX TER Semiconductor Equipment & Materials median
P/E 54.44 54.35 54.39
P/S 17.03 13.96 6.08
P/B 31.72 17.95 4.89
Price to free cash flow 80.88 77.92 60.92
EV/EBITDA 45.57 42.01 39.95
EV/Sales 16.95 13.94 6.36
Earnings yield 1.84% 1.84% 1.14%
Free cash flow yield 1.24% 1.28% 1.28%

Profitability

Metric LRCX TER Semiconductor Equipment & Materials median
Gross margin 50.47% 59.24% 43.95%
Operating margin 35.29% 30.23% 10.32%
Net margin 31.27% 25.77% 7.45%
Free cash flow margin 21.05% 17.92% 6.77%
Return on equity 65.07% 36.45% 4.78%
Return on assets 32.38% 26.48% 3.62%
Return on invested capital 48.23% 27.04% 6.10%

Growth

Metric LRCX TER Semiconductor Equipment & Materials median
Revenue growth (TTM) 26.02% 57.87% 14.60%
EPS growth (last fiscal year) 38.80% 4.52% —
Revenue growth, 5-year CAGR 9.70% 0.44% 8.85%
Net income growth, 5-year CAGR 13.20% (6.71%) 0.00%

Health

Metric LRCX TER Semiconductor Equipment & Materials median
Debt to equity 0.30 0.00 0.09
Current ratio 2.63 2.12 3.66
Net debt to EBITDA (0.21) (0.16) (0.49)

Dividend

Metric LRCX TER Semiconductor Equipment & Materials median
Dividend yield 0.90% 0.47% 0.85%
Payout ratio 0.21 0.13 0.00

Size

Metric LRCX TER Semiconductor Equipment & Materials median
Market cap 390.42b 62.38b 4.63b

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