Lam Research Vs. Kulicke And Soffa: Which Semiconductor Manufacturing Equipment Stock Is A Better Buy?

macro photography of black circuit board

Because the world is currently facing a shortage of semiconductors, which are essential for the products of several industries, including the automotive and electronics, semiconductor manufacturing equipment makers are witnessing high demand. So, the stocks of two major players in this industry—LAM Research (LRCX) and Kulicke and Soffa (KLIC)—are likely to benefit from this environment in the near to midterm. But which of these two stocks is a better buy now?

Lam Research Corporation and Kulicke and Soffa Industries, Inc. are two established companies that play an important role in providing equipment in the semiconductor industry. LRCX is a supplier of wafer fabrication equipment and services to the semiconductor industry. Headquartered in Singapore, KLIC designs, manufactures and sells capital equipment and expendable tools used to assemble semiconductor devices, such as integrated circuits (ICs).

The global semiconductor shortage on the back of rising demand for chips from several industries–such as electronics and automotive–is pushing semiconductor companies to ramp up production. This, combined with the huge government and private investments to increase the supply of semiconductors, is driving the demand for semiconductor manufacturing equipment. According to Fortune Business Insights, the global semiconductor market is expected to grow at an 8.6% CAGR between 2021 – 2028. So, LRCX and KLIC are expected to continue witnessing increasing demand for their solutions in the coming months.

But while KLIC has gained 108.3% over the past nine months, LRCX has returned 86.2%. Also, in terms of six months’ performance, KLIC is a clear winner with 64.5% returns versus LRCX’s 31.3%. But which of these two stocks is a better pick now? Let’s find out.

Click here to checkout our Semiconductor Industry Report for 2021

Latest Movements

KLIC announced in February  that it had acquired a 100% equity stake in Uniqarta, Inc., which includes Uniqarta’s patent portfolio and other intellectual property rights. The acquisition is  expected to help expand the company’s product portfolio in the mini- and micro-LED technology segment.

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