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LRCX vs TSM
Which Stock Would AI Choose? Lam Research Corporation (LRCX) vs. Taiwan Semiconductor Manufacturing Company (TSM) Stock Comparison
Key Takeaways
- Different roles in the AI supply chain: LRCX supplies the etch and deposition equipment used to build chips, while TSM is the world's largest contract chip foundry that actually manufactures them.
- Both are posting record results: LRCX reported record quarterly revenue of $6.72 billion, while TSM posted record third-quarter revenue of roughly NT$1.49 trillion, up about 50% year over year.
- Valuation contrast: LRCX trades at a premium forward price-to-earnings (P/E) multiple near 33x, versus roughly 29–30x for TSM.
- Momentum has cooled: Both stocks have experienced near-term pullbacks in recent weeks despite strong fundamentals and record results.
- Risk profiles differ: LRCX carries equipment-spending cycle risk, while TSM faces heavy capital expenditure commitments and geopolitical concentration risk.
Introduction
Lam Research Corporation (LRCX) and Taiwan Semiconductor Manufacturing Company (TSM) sit at two adjacent but distinct layers of the semiconductor industry. Lam Research builds the fabrication equipment that chipmakers use, while TSMC operates the foundries where those tools are deployed. This stock comparison is relevant for investors and traders seeking exposure to artificial intelligence (AI) infrastructure but uncertain whether to position upstream in equipment or downstream in manufacturing. The comparison highlights how relative performance, growth drivers, and market positioning can diverge even between companies riding the same secular demand wave.
LRCX Overview and Recent Performance
Lam Research Corporation (LRCX) is a leading supplier of wafer fabrication equipment, specializing in etch and deposition systems used to create the increasingly complex structures in advanced semiconductors. The company is a key vendor to major chipmakers, including TSMC and Samsung, positioning it directly along the path of AI-driven capital spending.
In recent market activity, LRCX has delivered a strong multi-quarter run, with shares gaining substantially over the trailing year. Its latest reported quarter showed revenue of $6.72 billion, up 30% year over year, while non-GAAP (non-Generally Accepted Accounting Principles) earnings per share rose about 37%. Margins expanded, and management raised its outlook for wafer fabrication equipment (WFE) spending into the low-$150 billion range for the calendar year, citing AI-related demand for memory, leading-edge foundry capacity, and advanced packaging. Despite these results, the stock has pulled back in recent weeks after a prolonged rally, and its premium valuation remains a focal point for investors.
TSM Overview and Recent Performance
Taiwan Semiconductor Manufacturing Company (TSM) is the world's largest dedicated semiconductor foundry, fabricating advanced chips for customers including Nvidia, Apple, AMD, and Qualcomm. Its leadership in leading-edge nodes and advanced packaging such as CoWoS (Chip-on-Wafer-on-Substrate) makes it central to the AI hardware ecosystem.
In recent market activity, TSM reported record third-quarter revenue of approximately NT$1.49 trillion (about $46.7 billion), a roughly 50% increase year over year that exceeded both its own guidance and analyst consensus. Analysts anticipated a sixth consecutive quarter of record net profit, with estimates pointing to a roughly 65% increase. The company has also raised capital expenditure guidance to between $60 billion and $64 billion for the year and unveiled a multi-year, $2 billion supply agreement with GlobalFoundries to expand silicon interposer capacity in the United States. Shares nonetheless pulled back in the days following the revenue release, reflecting high market expectations already embedded in the price.
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Head-to-Head Comparison
The two companies differ most clearly in their business models and growth drivers. LRCX is a capital-equipment supplier whose revenue tracks chipmakers' willingness to invest in new fabs and capacity; its demand is amplified by rising etch and deposition intensity in advanced chips but remains tied to the equipment-spending cycle. TSM, by contrast, operates the manufacturing capacity itself, earning revenue directly from wafer production and advanced packaging and benefiting from pricing power at leading-edge nodes.
On valuation, LRCX carries a higher forward P/E multiple than TSM, reflecting its rapid recent multiple expansion, though both trade above historical averages. Risk profiles also differ: LRCX faces sensitivity to memory and foundry capital-expenditure shifts, while TSM must manage heavy capex, overseas fab ramp costs, and geopolitical concentration tied to its Taiwanese manufacturing base. Market sentiment toward both has been broadly positive but increasingly selective, with investors demanding that record revenue translate into durable margin expansion and free cash flow.
Tickeron AI Verdict
Based on observable factors such as trend consistency, earnings momentum, and relative positioning, Tickeron's AI framework would likely view both stocks favorably but for different reasons. TSM currently presents a more stable, high-quality earnings trajectory, supported by record revenue, strong margins, and structural AI demand, which may appeal to models favoring trend consistency and fundamental strength. LRCX offers higher growth leverage to equipment spending but carries greater valuation and cyclicality risk. On balance, an AI-driven assessment would likely tilt toward TSM for its steadier profitability and market position, while still recognizing LRCX as a higher-beta beneficiary of the same theme.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
To compare these two companies we present long-term analysis, their fundamental ratings and make comparative short-term technical analysis which are presented below. The conclusion is LRCX is a Hold and TSM is a Hold.
LRCX in downward trend: price dove below 50-day moving average on October 12, 2026
LRCX moved below its 50-day moving average on October 12, 2026 date and that indicates a change from an upward trend to a downward trend. In 27 of 37 similar past instances, the stock price decreased further within the following month. The odds of a continued downward trend are 73%.
Technical Analysis (Indicators)
Bearish Trend Analysis
The 10-day RSI Indicator for LRCX moved out of overbought territory on October 06, 2026. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 48 similar instances where the indicator moved out of overbought territory. In 33 of the 48 cases, the stock moved lower in the following days. This puts the odds of a move lower at 69%.
The Momentum Indicator moved below the 0 level on October 12, 2026. You may want to consider selling the stock, shorting the stock, or exploring put options on LRCX as a result. In 56 of 82 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are 68%.
The Moving Average Convergence Divergence Histogram (MACD) for LRCX turned negative on October 12, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 59 similar instances when the indicator turned negative. In 37 of the 59 cases the stock turned lower in the days that followed. This puts the odds of success at 63%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where LRCX declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 65%.
Bullish Trend Analysis
The Stochastic Oscillator demonstrated that the ticker has stayed in the oversold zone for 2 days, which means it's wise to expect a price bounce in the near future.
The 10-day moving average for LRCX crossed bullishly above the 50-day moving average on September 30, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 12 of 12 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 90%.
Following a +5.78% 3-day Advance, the price is estimated to grow further. Considering data from situations where LRCX advanced for three days, in 269 of 321 cases, the price rose further within the following month. The odds of a continued upward trend are 84%.
LRCX may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In 277 of 341 cases where LRCX Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 81%.
Fundamental Analysis (Ratings)
The Tickeron PE Growth Rating for this company is 9 (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is 18 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is 35 (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 68, placing this stock slightly better than average.
The Tickeron Price Growth Rating for this company is 39 (best 1 - 100 worst), indicating steady price growth. LRCX’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Valuation Rating of 85 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: LRCX's P/B Ratio (31.546) is very high in comparison to the industry average of (8.078). P/E Ratio (54.595) is within average values for comparable stocks, (161.623). LRCX's Projected Growth (PEG Ratio) (1.463) is slightly higher than the industry average of (0.801). Dividend Yield (0.004) settles around the average of (0.002) among similar stocks. P/S Ratio (14.620) is also within normal values, averaging (27.897).
The Tickeron Seasonality Score of 85 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
Momentum Indicator for TSM turns negative, indicating new downward trend
TSM saw its Momentum Indicator move below the 0 level on October 12, 2026. This is an indication that the stock could be shifting in to a new downward move. Traders may want to consider selling the stock or exploring put options. Tickeron's A.I.dvisor looked at 84 similar instances where the indicator turned negative. In 61 of the 84 cases, the stock moved further down in the following days. The odds of a decline are at 73%.
Technical Analysis (Indicators)
Bearish Trend Analysis
The 10-day RSI Indicator for TSM moved out of overbought territory on October 07, 2026. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 52 similar instances where the indicator moved out of overbought territory. In 31 of the 52 cases, the stock moved lower in the following days. This puts the odds of a move lower at 60%.
The Moving Average Convergence Divergence Histogram (MACD) for TSM turned negative on October 09, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 46 similar instances when the indicator turned negative. In 29 of the 46 cases the stock turned lower in the days that followed. This puts the odds of success at 63%.
TSM moved below its 50-day moving average on October 14, 2026 date and that indicates a change from an upward trend to a downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where TSM declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 62%.
TSM broke above its upper Bollinger Band on October 05, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Bullish Trend Analysis
The Stochastic Oscillator demonstrated that the ticker has stayed in the oversold zone for 2 days, which means it's wise to expect a price bounce in the near future.
Following a +5.79% 3-day Advance, the price is estimated to grow further. Considering data from situations where TSM advanced for three days, in 234 of 315 cases, the price rose further within the following month. The odds of a continued upward trend are 74%.
The Aroon Indicator entered an Uptrend today. In 214 of 276 cases where TSM Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 78%.
Fundamental Analysis (Ratings)
The Tickeron Profit vs. Risk Rating rating for this company is 8 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 75, placing this stock better than average.
The Tickeron SMR rating for this company is 26 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron PE Growth Rating for this company is 29 (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Price Growth Rating for this company is 40 (best 1 - 100 worst), indicating steady price growth. TSM’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Seasonality Score of 50 (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Valuation Rating of 64 (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (11.614) is normal, around the industry mean (7.975). P/E Ratio (33.701) is within average values for comparable stocks, (165.532). Projected Growth (PEG Ratio) (0.859) is also within normal values, averaging (3.761). Dividend Yield (0.008) settles around the average of (0.007) among similar stocks. P/S Ratio (15.480) is also within normal values, averaging (45.794).
LRCX | TSM | ||
|---|---|---|---|
OUTLOOK RATING 1..100 | 81 | 85 | |
VALUATION overvalued / fair valued / undervalued 1..100 | 85 Overvalued | 64 Fair valued | |
PROFIT vs RISK RATING 1..100 | 35 | 8 | |
SMR RATING 1..100 | 18 | 26 | |
PRICE GROWTH RATING 1..100 | 39 | 40 | |
P/E GROWTH RATING 1..100 | 9 | 29 | |
SEASONALITY SCORE 1..100 | 85 | 50 |
Tickeron ratings are formulated such that a rating of 1 designates the most successful stocks in a given industry, while a rating of 100 points to the least successful stocks for that industry.
TSM's Valuation (64) in the Semiconductors industry is in the same range as LRCX (85) in the Electronic Production Equipment industry. This means that TSM’s stock grew similarly to LRCX’s over the last 12 months.
TSM's Profit vs Risk Rating (8) in the Semiconductors industry is in the same range as LRCX (35) in the Electronic Production Equipment industry. This means that TSM’s stock grew similarly to LRCX’s over the last 12 months.
LRCX's SMR Rating (18) in the Electronic Production Equipment industry is in the same range as TSM (26) in the Semiconductors industry. This means that LRCX’s stock grew similarly to TSM’s over the last 12 months.
LRCX's Price Growth Rating (39) in the Electronic Production Equipment industry is in the same range as TSM (40) in the Semiconductors industry. This means that LRCX’s stock grew similarly to TSM’s over the last 12 months.
LRCX's P/E Growth Rating (9) in the Electronic Production Equipment industry is in the same range as TSM (29) in the Semiconductors industry. This means that LRCX’s stock grew similarly to TSM’s over the last 12 months.
| LRCX | TSM | |
|---|---|---|
| RSI ODDS (%) | 2 days ago 69% | 2 days ago 60% |
| Stochastic ODDS (%) | 2 days ago 81% | 2 days ago 76% |
| Momentum ODDS (%) | 2 days ago 68% | 2 days ago 73% |
| MACD ODDS (%) | 2 days ago 63% | 2 days ago 63% |
| TrendWeek ODDS (%) | 2 days ago 64% | 2 days ago 64% |
| TrendMonth ODDS (%) | 2 days ago 82% | 2 days ago 78% |
| Advances ODDS (%) | 14 days ago 84% | 11 days ago 74% |
| Declines ODDS (%) | 2 days ago 65% | 4 days ago 62% |
| BollingerBands ODDS (%) | 2 days ago 85% | 2 days ago 58% |
| Aroon ODDS (%) | 2 days ago 81% | 2 days ago 78% |
Long-Term Analysis
It is best to consider a long-term outlook for a ticker by using Fundamental Analysis (FA) ratings. The rating of 1 to 100, where 1 is best and 100 is worst, is divided into thirds. The first third (a green rating of 1-33) indicates that the ticker is undervalued; the second third (a grey number between 34 and 66) means that the ticker is valued fairly; and the last third (red number of 67 to 100) reflects that the ticker is overvalued. We use an FA Score to show how many ratings show the ticker to be undervalued (green) or overvalued (red).
LRCX’s FA Score shows that 2 FA rating(s) are green while TSM’s FA Score has 3 green FA rating(s).
- LRCX’s FA Score: 2 green, 3 red.
- TSM’s FA Score: 3 green, 2 red.
Short-Term Analysis
It is best to consider a short-term outlook for a ticker by using Technical Analysis (TA) indicators. We use Odds of Success as the percentage of outcomes which confirm successful trade signals in the past.
If the Odds of Success (the likelihood of the continuation of a trend) for each indicator are greater than 50%, then the generated signal is confirmed. A green percentage from 90% to 51% indicates that the ticker is in a bullish trend. A red percentage from 90% - 51% indicates that the ticker is in a bearish trend. All grey percentages are below 50% and are considered not to confirm the trend signal.
LRCX’s TA Score shows that 5 TA indicator(s) are bullish while TSM’s TA Score has 3 bullish TA indicator(s).
- LRCX’s TA Score: 5 bullish, 5 bearish.
- TSM’s TA Score: 3 bullish, 6 bearish.
Price Growth
LRCX (@Electronic Production Equipment) experienced а -12.93% price change this week, while TSM (@Semiconductors) price change was -8.94% for the same time period.
The average weekly price growth across all stocks in the @Electronic Production Equipment industry was -15.43%. For the same industry, the average monthly price growth was -5.59%, and the average quarterly price growth was -18.80%.
The average weekly price growth across all stocks in the @Semiconductors industry was -12.24%. For the same industry, the average monthly price growth was -4.15%, and the average quarterly price growth was +8.13%.
Reported Earning Dates
LRCX is expected to report earnings on Oct 21, 2026.
TSM is expected to report earnings on Oct 15, 2026.
Industries' Descriptions
@Electronic Production Equipment (-15.43% weekly)The electronic production equipment industry makes equipment used to produce semiconductors. Such equipment includes wafer fabrication, plasma etching and photo-resist processing equipment. The industry also makes chemical vapor deposition processing systems and photomasks, which are high-purity quartz plates that contain patterns to define integrated circuits layouts. Applied Materials, Inc., Lam Research Corporation, and KLA-Tencor Corporation are examples of electronic production equipment manufacturing companies.
@Semiconductors (-12.24% weekly)The semiconductor industry manufacturers all chip-related products, including research and development. These chips are used in innumerable electronic devices, including computers, cell phones, smartphones, and GPSs. Intel Corporation, NVIDIA Corp., and Broadcomm are some of the prominent players in this industry. Semiconductor companies usually tend to do well during periods of healthy economic growth, thereby inducing further research and development in the industry – which in turn augurs well for productivity and growth in the economy. In the near future, demand for semiconductor products (and possibly innovation within the segment) should only expand further, with the proliferation of 5G, autonomous vehicles, IoT, and various AI-driven electronics set to herald a new, advanced chapter in the technology-driven world as we know it. With burgeoning prospects comes great competition. In 2015, SIA estimated that U.S. semiconductor industry ranks as the second most competitive U.S. industry out of 2882 U.S. industries designated manufacturers by the U.S. Census Bureau.
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