Shares of semiconductor equipment manufacturers rallied sharply on Thursday, with Lam Research hitting an all-time high of $349.21, while Applied Materials and KLA also posted strong gains. The surge came as multiple Wall Street analysts raised price targets and earnings estimates for the sector, citing robust artificial intelligence-driven demand and extended order visibility.
Lam Research’s stock closed in on its 52-week high, having risen roughly 279% over the past year. The company reported Q3 EPS of $1.47, beating consensus of $1.36, on revenue of $5.84 billion, which topped forecasts by over $100 million. Guidance for the coming quarter came in at $1.50–$1.80 per share. Mizuho set a $380 target with an outperform rating, while Cantor Fitzgerald went even higher to $425, highlighting AI-driven advanced packaging. UBS, Barclays, and Jefferies also lifted their targets, with the consensus rating a Moderate Buy.
Institutional ownership remains high, with Vanguard holding $17.5 billion worth of Lam Research shares and Norges Bank opening a new $3.6 billion position. Insiders sold about $8.56 million under pre-arranged plans. The company declared a $0.26 quarterly dividend.
Barclays was a key driver, reaffirming Overweight ratings on Applied Materials and KLA, raising AMAT’s target to $590 and KLAC’s to $2,250. The bank now expects the total wafer fab equipment market to reach $154 billion, up from a prior estimate of $139 billion, and to jump 36% to $209.5 billion in 2027. Analyst Tom O’Malley wrote that AI remains the primary catalyst, noting heavy investment from memory makers like Micron, SK Hynix, and Samsung, as well as advanced chip producers TSMC and Intel.
Cantor Fitzgerald expects industry wafer fabrication equipment spending could approach $250 billion as the semiconductor market grows toward $3 trillion by 2029, with bookings visibility now extending into 2028. Applied Materials is expanding capacity with a $500 million Singapore campus that will more than double cleanroom space and create about 1,000 jobs.
Despite recent volatility in the broader chip sector, the combination of AI-fueled demand, extended order backlogs, and upbeat analyst commentary has renewed buying interest in semiconductor equipment stocks.
