S&P: LAM outlook stable

Standard & Poor's said it revised its outlook on LAM Research Corp. to stable from negative. Ratings, including the BB- corporate credit rating, were affirmed.

S&P said the outlook change reflects recently improving operating performance, a function of cyclically recovering markets and stepped-up semiconductor capital investment.

The ratings reflect LAM's narrow business focus and limited profitability base within the highly volatile semiconductor capital equipment market, as well as the company's leveraged financial profile, according to S&P. These factors are offset, in part, by LAM's leadership market position in its niche segment, combined with adequate financial flexibility deriving from its liquid financial profile.

Pro forma for the calling of the $300 million bond, debt protection metrics improve to 1.1x based on last-12-month EBITDA as of March 28, from the actual level of 4.7x.

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