RBC Capital Initiates Coverage on KLA at Sector Perform

RBC Capital analyst Srini Pajjuri initiates coverage on KLA Corporation (NASDAQ: KLAC) with a Sector Perform rating and a price target of $1,550.00.

“KLAC outperformed the SOX index over the past year driven by a favorable WFE environment and secular growth in process control intensity.

GenAI is driving more leading-edge design starts, larger dies, and more complex packages – all tailwinds to process control intensity.

In addition, HBM and advanced packaging are helping expand the company’s SAM. Services is sustaining double-digit growth and China is largely de-risked.

However, premium valuation, lower Memory exposure than peers, and lack of major new process node development in the industry until late 2026 keep us on the sidelines. Initiate at Sector Perform.”

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