TD Cowen analyst Krish Sankar has maintained their neutral stance on KLAC stock, giving a Hold rating on October 20.
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Krish Sankar has given his Hold rating due to a combination of factors related to KLA’s performance and market dynamics. While KLA is positioned to outperform the wafer fabrication equipment (WFE) market, the gap between KLA’s growth and the overall WFE growth may narrow after a strong 2025. The company’s advanced packaging segment presents a promising opportunity for market share gains, and WFE growth in this area is expected to surpass front-end growth by 2026.
Despite KLA’s expected growth in process control systems and a positive outlook for DRAM revenues, the company’s revenue from China is anticipated to decline significantly. This decrease is attributed to a lower mix from China, which is expected to impact overall revenues. Furthermore, while KLA’s guidance suggests strength in the upcoming quarters, the projected revenue growth for 2026 is modest, leading to a balanced view reflected in the Hold rating.
In another report released on October 20, UBS also maintained a Hold rating on the stock with a $1,135.00 price target.