KLA Corporation (KLAC) DCF Valuation
Transparent DCF models put KLA Corporation (KLAC)'s fair value in a range of $381.73 – $596.04 — the low end is TGM's conservative base case (5% FCF growth, 10% discount), the high end the analyst consensus (FMP). Today's price of $2,141.05 sits above that range — by these conservative assumptions it looks richly valued; the reverse-DCF below is the better lens for a high-growth name.
Reverse DCF: at today's $2,141.05, the market is pricing in roughly +27.9%/yr free-cash-flow growth over the next decade (at a 10% required return) — versus its actual 5-year FCF CAGR of +15.5%. The price is betting on acceleration above its track record.
Current Price
$2,141.05
Fair-Value Range
$381.73 – $596.04
Market-Implied Growth
+27.9%/yr
vs +15.5% 5Y actual
KLAC DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Illustrative model — not investment advice. Defaults to a conservative base case; the analyst (FMP) DCF, where available, is shown as a reference below.
Base inputs: FCF $3.3B · 0.13B shares · net debt $3.8B
Estimated Fair Value
$381.73
-82.2% vs $2141.05
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 5.0%/yr FCF growth and 10-year horizon fixed. Green = above today's $2141.05; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 8.0% | $481 | $508 | $539 | $576 | $621 |
| 9.0% | $409 | $427 | $448 | $472 | $501 |
| 10.0% | $355 | $367 | $382 | $398 | $417 |
| 11.0% | $311 | $321 | $331 | $343 | $356 |
| 12.0% | $277 | $284 | $291 | $300 | $310 |
About KLA Corporation
KLA Corporation specializes in creating, manufacturing, and distributing advanced solutions vital for process control, process optimization, and yield enhancement throughout the global semiconductor and broader electronics industries. The company organizes its business into four main segments: Semiconductor Process Control, Specialty Semiconductor Process, PCB, Display and Component Inspection, and an 'Other' category. For integrated circuit (IC) fabrication, KLA offers a comprehensive range of products. These include systems for wafer inspection, review, and metrology; defect inspection and metrology for both wafers/substrates and reticles; chemical and materials quality analysis tools; and real-time process management and wafer handling diagnostics essential for IC and original equipment manufacturer (OEM) production. Furthermore, the company develops software for live process control, defect excursion identification, process corrections, and defect classification. KLA also supplies refurbished and remanufactured equipment. Beyond IC manufacturing, KLA supports specialty semiconductor production. This includes benchtop metrology, surface characterization, and electrical property measurement services suitable for general-purpose and laboratory use. They also provide technologies and solutions for etching, plasma dicing, deposition, and various other wafer processing tasks within the semiconductor and microelectronics sectors. Within the printed circuit board (PCB) market, KLA delivers solutions such as direct imaging, inspection, optical shaping, additive printing, and computer-aided manufacturing and engineering. For the display industry, their offerings encompass inspection and electrical testing systems to pinpoint and categorize defects, as well as equipment for defect repair. KLA also supplies inspection and metrology systems designed to improve quality control and yield in both advanced and conventional semiconductor packaging markets. Established in 1975, the company was initially known as KLA-Tencor Corporation before rebranding as KLA Corporation in July 2019. Its corporate headquarters are situated in Milpitas, California.
- Sector
- Technology
- Industry
- Semiconductors
- CEO
- Richard Wallace