Why Lam Research (LRCX) Shares Are Falling

Lam Research Corporation LRCX shares are trading lower by 8.54% to $984.14 during Wednesday's session. The broader semiconductor sector is experiencing a downturn amid reports that President Biden may impose further restrictions on China. Additionally, Republican nominee Donald Trump’s statements about the China-Taiwan standoff in a Bloomberg interview and ASML’s cautious guidance are contributing to the decline.

Donald Trump’s comments about Taiwan taking “100% of our chip business” and criticizing U.S. outsourcing practices to Taiwan-based suppliers may have raised concerns about potential policy changes or increased geopolitical tensions between the U.S., Taiwan and China. Such uncertainties can negatively impact investor confidence in companies closely tied to the semiconductor supply chain, including Lam Research.

Lam Research is a major supplier of semiconductor manufacturing equipment. A significant portion of its business depends on companies like TSMC, which is a key player in the semiconductor industry.

As TSMC’s stock is falling due to political comments and market sentiment, it can lead to concerns about a potential slowdown in orders or investment in new equipment from TSMC, affecting Lam Research’s future revenue.

Read Also: What's Going On With Alibaba And Peer Chinese Stocks On Wednesday?

Should I Sell My LRCX Stock?

When deciding to hold on to or sell a stock, investors should consider their time horizon, unrealized gains and total return.

Shares of Lam Research have increased by 56.03% in the past year. An investor who bought shares of Lam Research at the beginning of the year would make a profit of $249.46 per share if they sold it today. The stock has fallen 8.34% over the past month, meaning an investor who bought shares on Jun. 1 would see a capital gain of $63.13.

Lam Research shares have an all-time high of $1127.3, representing 12.87% upside from current levels.

Investors may also consider market dynamics. The Relative Strength Index can be used to indicate whether a stock is overbought or oversold. Lam Research stock currently has an RSI of 44.52, indicating neutral conditions.

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LRCX has a 52-week high of $255.89 and a 52-week low of $129.21.