Lam Research: A Decent Buy On Recent Weakness

Lam Research (NASDAQ: LRCX), a leading provider of semiconductor fabrication equipment, has been trending lower lately. The stock lost 10% of its value during the last month or so. The stock reacted to the spending delay from Samsung. We see this weakness as an opportunity to buy low. Our opinion is based on the following argument:

1. Spending hikes from memory players and evolution in technology bodes well for Lam Research.
2. Strong results from counterparts indicate that equipment spending projections for 2015 are intact.
3. Lam comes with a consistent performance and a strong balance sheet.
4. Analyst-sentiment is inclined towards Lam and technical indications are also favorable.

We think Lam's stock has the potential to gain 30%-35% in the next year or so. Detailed analysis will follow later.