KLA Corp (KLAC) stock analysis

P/E above its 5-year median

KLA's P/E of 40.3 is above its own 5-year median of 29.3.

P/E above the industry

KLA's P/E of 40.3 is above the Laboratory Apparatus and Analytical, Optical, Measuring, and Controlling Instruments median of 36.5.

EV/EBITDA above its 5-year median

KLA's EV/EBITDA of 30.6 is above its 5-year median of 21.0.

P/B above the industry

KLA's price-to-book of 32.16 is above the Laboratory Apparatus and Analytical, Optical, Measuring, and Controlling Instruments median of 3.17.

Trading above fair value

The share price of $161.01 is above our fair value estimate of $125.09.

Margin of safety under 20%

The price is 28.7% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 9.0% a year over the last three fiscal years, short of the 10% we look for.

EPS growing 10%+ a year

Diluted EPS grew 14.9% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 24.1% over the last twelve months, against a 5-year average of 18.4% a year.

Growing faster than the industry

Revenue grew 15.8% over the last twelve months; the Laboratory Apparatus and Analytical, Optical, Measuring, and Controlling Instruments median is 8.4%.

Guidance issued

The latest outlook (second quarter of fiscal 2027 Total revenues, Oct 28, 2026) was issued for the first time, so it neither adds nor takes away points.

Gross margin improving

Gross margin was 61.5% over the last twelve months, against 61.3% a year earlier.

Return on equity over 15%

Return on equity was 91.4% over the last twelve months and averaged 114% over five years.

Return on invested capital

Needs operating income and invested capital.

Return on equity above the industry

KLA's return on equity of 91.4% is above the Laboratory Apparatus and Analytical, Optical, Measuring, and Controlling Instruments median of 1.1%.

Earnings grew over 5 years

Net income grew 18.4% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 36.2% over the last twelve months, against a 5-year average of 33.1%.

Net margin above the industry

KLA's net margin of 36.2% is above the Laboratory Apparatus and Analytical, Optical, Measuring, and Controlling Instruments median of -1.3%.

Debt level

Needs debt and equity figures.

Debt trend

Needs a balance sheet from five years ago with positive equity.

Debt coverage

Needs operating cash flow.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 2.76 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 12.21; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

KLA paid dividends worth 0.5% of the share price over the last twelve months.

Yield below Treasuries

The 0.5% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; KLA yields 0.5%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 21.1% of net income.

Covered by free cash flow

Dividends take 27.5% of free cash flow.