Citi raises price targets on Applied Materials, Lam Research, and KLA amid surging wafer fab equipment demand

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Citi raised its price targets on three major semiconductor equipment makers, lifting Applied Materials to $710 from $550, Lam Research to $450 from $315, and KLA Corporation to $290 from $206.40, after updating its forecasts for global wafer fab equipment spending. The firm now projects bull-case WFE spending of approximately $145 billion in 2026, $200 billion in 2027, and $250 billion in 2028, the first time it has introduced a 2028 forecast, based on an updated hyperscaler capital expenditure model. Citi said it has become more constructive on 2028 WFE given continued capacity constraints and expansion at TSMC and memory makers, as well as recent progress at Intel and Samsung foundries, with the 2028 figure implying 25% growth over the prior year. The rise of agentic AI is driving a structural increase in NAND demand, as memory requirements surge while DRAM supply tightens, and Citi estimated that closing the gap would require two to four new greenfield fabs, representing $20 billion to $40 billion in capital expenditure, or $15 billion to $30 billion in NAND-specific wafer fab equipment spending.

Impact on stocks 7

Semiconductors▲ · 5 stocks
Applied Materials Inc
AMAT
▲ PositiveCapitalrelevance

Citi raised price target to $710 from $550, citing updated WFE spending forecasts.

KLA Corporation
KLAC
▲ PositiveCapitalrelevance

Citi raised price target to $290 from $206.40, citing updated WFE spending forecasts.

Lam Research Corp
LRCX
▲ PositiveCapitalrelevance

Citi raised price target to $450 from $315, citing updated WFE spending forecasts.

Artificial Intelligence▲ · 1 stocks
Digital Finance & Tokenization▲ · 1 stocks

Theme Impact 2

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