UPDATE: Bank of America Upgrades Lam Research as Cycles Improve in CY14

In a report published Wednesday, Bank of America analyst Krish Sankar upgraded the rating on Lam Research LRCX from Underperform to Buy, and raised the price target from $38.00 to $61.00.

In the report, Bank of America noted, “We are upgrading Lam Research from an Underperform to a Buy rating based on our view of an improving cycle in CY14 (capex +14% Y/Y, WFE +20% Y/Y as more of the spending shifts to equipment), pick-up in memory spend and newer technologies such as 3D NAND (2x more capital intensive than planar), FinFET which are more deposition and etch-intensive. While cyclically the company is well positioned to benefit from the technology inflections, the valuation is also attractive with the stock trading at 9-10x our CY14E EPS compared to peers at 13x. Our new price objective is $61.”

Lam Research closed on Tuesday at $45.17.