Stifel Raises KLA Price Target to $1,600

Stifel analyst Brian Chin raised the price target on KLA Corporation (NASDAQ: KLAC) to $1,600.00 (from $1,260.00) while maintaining a Buy rating.

“We have a Buy rating on KLA, a leading supplier of inspection and metrology (aka process control) equipment used to help monitor/improve/ optimize the production ramp/output of semiconductor device manufacturing.

History suggests that KLA is resistant to downturns, the underlying rationale being that leading semi manufacturers tend to preserve strategic investment in R&D/technology roadmaps, with process control/inspection budgets typically oriented more toward the earlier stages of leading-edge node transitions.

We believe the heightened competitive environment in advanced foundry-logic, broadening adoption of EUV (incl. in DRAM), and fast-approaching technology inflections in both transistor and interconnect design argue for sticky-higher levels of process control intensity.

Ultimately, we are more willing to pay a premium for higher visibility, margin structures, and resiliency.”

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