KLAC Value Scorecard - KLA Corporation

Value Scorecard · run 2026-10-18

13 value checks: 12 scored 1 to 5, plus moat evidence

44/60

moderate value score

Earnings & returns

EPS Trend

4/5

Diluted EPS: $2.42 (2023), $2.03 (2024), $3.04 (2025), $3.66 (2026). It rose every year but one and ended above 2023; the framework scores that as 4.

ROE Trend

5/5

ROE (net income / common equity): 116.0% (2023), 82.0% (2024), 86.6% (2025), 76.1% (2026). Median 84.3%, lowest 76.1%; the framework scores a median above 20% as 5.

ROIC

5/5

ROIC of 43.2%: earnings before interest and taxes of $5.89B (pre-tax income $5.61B plus interest expense $284.44M; the 10-K's financial data has no standard operating income figure) divided by $13.65B of capital (total assets $17.95B minus current liabilities $4.30B), fiscal year to Jun 30, 2026, as filed in the 10-K (SEC EDGAR). The framework scores above 20% as 5.

Profit Margins

5/5

Net margin of 35.6%; the framework scores above 20% as 5; gross margin 61.3%, operating margin 42.5%.

Balance sheet & cash

Debt-to-Equity

3/5

Debt-to-equity of 0.97; the framework scores 0.8-1.5 as 3 (total debt $6.15B, total cash $4.90B).

Free Cash Flow

4/5

Free cash flow (operating cash flow minus capital expenditure): $3.33B (2023), $3.03B (2024), $3.75B (2025), $3.77B (2026). It rose every year but one and ended above 2023; the framework scores that as 4.

Retained Earnings

5/5

Retained earnings, as filed in the 10-Ks (SEC EDGAR): $848.43M (2023), $1.14B (2024), $2.18B (2025), $3.68B (2026). It rose every year; the framework scores that as 5.

Valuation models

Graham IV

3/5

IV = EPS x (8.5 + 2g) x (4.4 / Y) = $3.66 x (8.5 + 2 x 20.0) x (4.4 / 4.5) = $173.57 (EPS CAGR 34.3% capped at 20%). Current price $165.74; price is 4.5% below the model value.

DCF Value

1/5

FCF/share = $2.011, stage 1 growth = 17.6% for 5 years, terminal growth = 3%, discount rate = 10%. Stage 1 PV = $12.34, PV of terminal value = $41.33, DCF value = $53.67. Current price $165.74; price is 208.8% above the model value.

Margin of Safety

3/5

Graham value $173.57 (price is 4.5% below the model value); DCF value $53.67 (price is 208.8% above the model value).

Price-to-Book

1/5

P/B of 34.12; the framework scores above 5.0 as 1.

Business quality

Moat Evidence

Not scored

A moat (a brand, a network, switching costs, patents, scale, a licence) is not a number in the filings, so Valerius doesn’t score it. Below are the figures and the words moat analysis starts from, from the company’s own 10-K filings. The conclusion is yours.

Return on capital, each year

Above 15% in 10 of 10 years (2017-2026); lowest 19.5%, highest 43.2%.

Gross margin, each year

Between 57.8% and 64.2% over 10 years (a range of 6.4 points).

Competition, in the company’s own words · 10-K filed Aug 6, 2026

The worldwide market for technologically advanced process control, process-enabling and yield management solutions used by semiconductor and electronics manufacturers is highly competitive, with important competitive factors including system performance, ease of use, reliability, technical service and support, and overall cost of ownership. However, we believe that, while these competitive factors are important, our

The opening of the company’s “Competition” section in its 10-K, quoted word for word, not summarized or edited. It is the company’s own description, not Valerius’s view, and may include the company’s expectations. Open the filing.

Return on capital = operating income / (total assets − current liabilities), the ROIC row’s definition; 15% is the framework’s return threshold. For a year whose 10-K financial data has no standard operating income figure, earnings before interest and taxes (pre-tax income plus interest expense) is used. Gross margin = gross profit / revenue. Both from each year’s 10-K via SEC EDGAR. Moat analysis commonly looks at whether returns and margins held up over many years. These figures don’t say whether the company has an advantage, what it is, or whether it will last.

Capital Allocation

5/5

Capital allocation, 2023-2026: dividends or buybacks paid in every year (pass); $10.96B paid out against $13.87B of free cash flow (pass); total debt $6.06B to $6.15B, up 1.5%, 1.0x EBITDA (pass: not up more than 10%); shares outstanding 1.37B to 1.31B, down 4.4% (pass). 4 of 4 tests passed; the framework scores that as 5.

Filings

Company notices to the SEC

Not scored

Three kinds of event the company reported to the SEC in the last 5 years, from its filings on SEC EDGAR.

These are events the company reported to the SEC. An auditor change or a late filing can have many causes; each date links to the filing, where the company explains it. Valerius does not score these.

How the Graham and DCF values were calculated

  Graham Formula:
    IV = EPS x (8.5 + 2g) x (4.4 / Y)
    EPS = $3.66, g = 20.0%, Y = 4.5
    g capped at 20.0% (3-year EPS CAGR was 34.3%)
    IV = $173.57
    Current price $165.74 vs Graham value $173.57 — price is 4.5% below the model value.

  DCF:
    FCF/share = $2.011
    Stage 1 growth = 17.6% for 5 years | terminal growth = 3.0% | discount rate = 10.0%
      Y1: $2.365 → PV $2.150
      Y2: $2.781 → PV $2.299
      Y3: $3.271 → PV $2.457
      Y4: $3.847 → PV $2.627
      Y5: $4.524 → PV $2.809
    Stage 1 PV sum = $12.34
    Terminal value at end of Y5 = $66.56
    PV of terminal value = $41.33
    DCF value = $53.67
    Current price $165.74 vs DCF value $53.67 — price is 208.8% above the model value.

Data from yfinance summary figures and financial statements, and from the company’s 10-K filings via SEC EDGAR; computed at a price of $165.74. Every score is calculated from the figures by the framework’s fixed rules, and the explanation beside it is generated from the same figures: Graham value, DCF value, margin of safety, ROIC, profit margins, debt-to-equity, price-to-book, EPS trend, ROE trend, free cash flow, retained earnings and capital allocation. No AI is involved in this scorecard. The moat is shown as evidence, without a score. Read each score with the figures beside it. Intrinsic value calculations are model outputs based on stated assumptions, not predictions.

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