Is Lam Research Corp. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Lam Research Corp. has moved from expensive to attractive, indicating a shift towards a more favorable assessment. The company appears undervalued based on its current metrics, with a P/E ratio of 54, a Price to Book Value of 26.58, and an EV to EBITDA of 44.43. In comparison, peers such as Applied Materials, Inc. have a P/E of 45.37 and an EV to EBITDA of 34.21, while Parker-Hannifin Corp. shows a P/E of 37.22 and an EV to EBITDA of 28.77, suggesting that Lam Research Corp. is trading at a premium relative to some competitors but still presents an attractive investment opportunity.
Additionally, Lam Research Corp. has demonstrated impressive returns, with a year-to-date return of 95.92% compared to the S&P 500's 13.30%, and a three-year return of 348.64% against the S&P 500's 81.19%. This strong performance reinforces the notion that the stock is undervalued in the current market context.