KLA (KLAC) shares dropped sharply after fresh US tariff threats on Chinese goods and new Chinese restrictions on rare earth exports rattled semiconductor stocks, fueling renewed fears about global supply chain stability and rising costs.

See our latest analysis for KLA.

KLA's stock has had a rollercoaster week, tumbling 10% in the past seven days as fresh trade tensions rattled the sector, even after notching a 61% share price return year-to-date. This rapid momentum follows strong, AI-fueled demand and several upbeat corporate updates, but the share price remains sensitive to market-wide shifts in risk appetite, as reflected in its latest drop. Even so, its long-term total shareholder return stands out, with an impressive 301% over three years and more than 424% over five, speaking to the company’s enduring growth potential despite near-term volatility.

If the semiconductor sector’s swings have you curious about what else is accelerating in tech, it’s a great moment to discover See the full list for free.

With KLA’s shares pulling back sharply despite continued analyst optimism and robust earnings projections, the question for investors is clear: is recent volatility opening a window to buy this semiconductor leader, or are future gains already fully accounted for?

KLA’s widely followed narrative values the shares below the last close, suggesting the company’s stellar run has left little near-term upside. If you want to understand what’s really driving this tension, look closely at the demands shaping KLA’s revenue and margins.

The advanced packaging market is experiencing early-stage, secular growth fueled by adoption of 2.5D/3D architectures and HBM, driving KLA's advanced packaging revenue target for 2025 up nearly 80% year-over-year with expectations that this trend is "closer to the beginning than the end". This directly expands KLA's addressable market and should provide multi-year upside to revenue.

Read the complete narrative.

Want to know if explosive packaging demand alone justifies today’s price? The detailed forecast in this narrative uses aggressive margin expansion and multi-year EPS targets, plus a future profit multiple rivaling the industry’s top players. Curious what powers their fair value math? Dive deeper to see which bold assumptions could make or break this price target.

Result: Fair Value of $972.48 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, continued tariff headwinds and further weakness in China sales could undermine KLA’s growth momentum sooner than bullish forecasts expect.

Find out about the key risks to this KLA narrative.

If you see things differently or want to dig into the numbers on your own terms, it takes just a few minutes to shape your own view. Do it your way

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding KLA.

Don’t wait for the next market headline to pass you by. Smart moves start with the right stocks on your radar today. Use these curated lists to spot unique opportunities you may have missed:

Zero in on income potential with steady yields by checking out these 18 dividend stocks with yields > 3% offering more than 3% returns right now.

Tap into overlooked growth stories with these 893 undervalued stocks based on cash flows that could be flying under the market’s radar yet remain backed by proven cash flows.

Ride the wave of artificial intelligence by following these 25 AI penny stocks driving the next era of breakthrough technology and innovation.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include KLAC .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

KLA (KLAC) shares dropped sharply after fresh US tariff threats on Chinese goods and new Chinese restrictions on rare earth exports rattled semiconductor stocks, fueling renewed fears about global supply chain stability and rising costs.

See our latest analysis for KLA.

KLA's stock has had a rollercoaster week, tumbling 10% in the past seven days as fresh trade tensions rattled the sector, even after notching a 61% share price return year-to-date. This rapid momentum follows strong, AI-fueled demand and several upbeat corporate updates, but the share price remains sensitive to market-wide shifts in risk appetite, as reflected in its latest drop. Even so, its long-term total shareholder return stands out, with an impressive 301% over three years and more than 424% over five, speaking to the company’s enduring growth potential despite near-term volatility.

If the semiconductor sector’s swings have you curious about what else is accelerating in tech, it’s a great moment to discover See the full list for free.

With KLA’s shares pulling back sharply despite continued analyst optimism and robust earnings projections, the question for investors is clear: is recent volatility opening a window to buy this semiconductor leader, or are future gains already fully accounted for?

KLA’s widely followed narrative values the shares below the last close, suggesting the company’s stellar run has left little near-term upside. If you want to understand what’s really driving this tension, look closely at the demands shaping KLA’s revenue and margins.

The advanced packaging market is experiencing early-stage, secular growth fueled by adoption of 2.5D/3D architectures and HBM, driving KLA's advanced packaging revenue target for 2025 up nearly 80% year-over-year with expectations that this trend is "closer to the beginning than the end". This directly expands KLA's addressable market and should provide multi-year upside to revenue.

Read the complete narrative.

Want to know if explosive packaging demand alone justifies today’s price? The detailed forecast in this narrative uses aggressive margin expansion and multi-year EPS targets, plus a future profit multiple rivaling the industry’s top players. Curious what powers their fair value math? Dive deeper to see which bold assumptions could make or break this price target.

Result: Fair Value of $972.48 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, continued tariff headwinds and further weakness in China sales could undermine KLA’s growth momentum sooner than bullish forecasts expect.

Find out about the key risks to this KLA narrative.

If you see things differently or want to dig into the numbers on your own terms, it takes just a few minutes to shape your own view. Do it your way

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding KLA.

Don’t wait for the next market headline to pass you by. Smart moves start with the right stocks on your radar today. Use these curated lists to spot unique opportunities you may have missed:

Zero in on income potential with steady yields by checking out these 18 dividend stocks with yields > 3% offering more than 3% returns right now.

Tap into overlooked growth stories with these 893 undervalued stocks based on cash flows that could be flying under the market’s radar yet remain backed by proven cash flows.

Ride the wave of artificial intelligence by following these 25 AI penny stocks driving the next era of breakthrough technology and innovation.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include KLAC .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

Find out about the key risks to this KLA narrative.

If you see things differently or want to dig into the numbers on your own terms, it takes just a few minutes to shape your own view. Do it your way

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding KLA.

Don’t wait for the next market headline to pass you by. Smart moves start with the right stocks on your radar today. Use these curated lists to spot unique opportunities you may have missed:

Zero in on income potential with steady yields by checking out these 18 dividend stocks with yields > 3% offering more than 3% returns right now.

Tap into overlooked growth stories with these 893 undervalued stocks based on cash flows that could be flying under the market’s radar yet remain backed by proven cash flows.

Ride the wave of artificial intelligence by following these 25 AI penny stocks driving the next era of breakthrough technology and innovation.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include KLAC .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com