What Happened?
Shares of semiconductor equipment maker Lam Research (NASDAQ: LRCX) jumped 4.8% in the afternoon session after the company announced a breakthrough in advanced chip-making technology and received positive updates from analysts. The key development was a new etch technology, a vital step in making chips, designed for advanced packaging crucial for AI and 3D chip designs. This new method helps address issues with wafers warping during production. Following this news, Stifel raised its price target on the stock from $115.00 to $135.00, pointing to growth in memory markets. Similarly, Needham increased its price target from $115 to $150. The positive sentiment was part of a broader trend, as other chip companies like Taiwan Semiconductor Manufacturing also saw their shares rise.
The shares closed the day at $137.76, up 4.9% from previous close.
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What Is The Market Telling Us
Lam Research’s shares are very volatile and have had 22 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 3 days ago when the stock dropped 5.8% on the news that President Donald Trump threatened to impose 'massive' new tariffs on Chinese goods, a response to Beijing's decision to tighten export controls on rare earth metals. The escalating trade friction sent shockwaves through the market, with the PHLX Semiconductor Index (SOX) falling 4%. The move from China involves expanding restrictions on several rare earth elements, which are critical components for a wide range of high-tech products, including semiconductors. President Trump's retaliatory tariff threat intensified investor concerns about potential supply chain disruptions and increased costs for chipmakers. This geopolitical tension has created significant uncertainty, leading to a broad sell-off in the tech sector and pulling down major indexes like the S&P 500 and Nasdaq.
Lam Research is up 90.2% since the beginning of the year, and at $137.78 per share, it is trading close to its 52-week high of $149.15 from October 2025. Investors who bought $1,000 worth of Lam Research’s shares 5 years ago would now be looking at an investment worth $3,682.
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