If You Only Buy One Chip Stock This September, History Points to This One

If You Only Buy One Chip Stock This September, History Points to This One

Micah Zimmerman, The Motley Fool

Wed, September 2, 2026 at 4:21 PM GMT+3 6 min read

If I had to choose one semiconductor stock to buy going into September, Lam Research (NASDAQ: LRCX) would be near the top of my list. Its seasonal track record is worth paying attention to, but the bigger story is what's happening across the business right now. Demand for chipmaking equipment remains strong, AI investment continues to drive spending, and several of Lam Research's growth areas are starting to come together at the same time.

Data over the past 20 years shows that a buy date of Sept. 9 and a sell date of Jan. 10 produced a geometric average return of 7.46% above the S&P 500. That strategy beat the benchmark index in 17 of 20 periods.

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Seventeen out of 20 is a strong hit rate, and it aligns with the broader semiconductor pattern, where a Sept. 22 entry has beaten the index by 5.39% annually over the same span. The market as a whole averages a 0.7% loss in September, with gains only 46% of the time.

Why does this pattern exist?

The seasonal window tracks capital equipment budgeting. Chipmakers finalize their spending plans in the back half of the year, and orders placed during that period convert into revenue over the following quarters. Lam's business responds before the chips those tools produce ever ship.

That cycle is running hot right now. Lam raised its 2026 wafer fab equipment outlook to the low-$150 billion range, up from a prior view of $140 billion. Guidance for the quarter that ends in September calls for $8.1 billion in revenue, which would be roughly 20% sequential growth.

What the company does

Think of a chip as a skyscraper built one floor at a time. Lam sells the machines that lay down each layer of material and then carve patterns into it. No chips can be manufactured without that step, which is why Lam benefits from all aspects of the AI data center build-out, whether the chip designs come from Nvidia, Broadcom, or a company nobody has heard of yet.

Three parts of the business are working simultaneously right now. The first is NAND flash, and it caught almost everyone off guard. Lam's revenue from that segment more than doubled from the prior quarter as memory-chip makers rushed to upgrade older factories for the enterprise drives that AI data centers keep buying. Here is the part that makes this more than a one-time bump. As NAND chips go from 128 layers to 500 and beyond, manufacturing them gets harder, and Lam's opportunity per wafer doubles along the way. Management believes this upgrade wave will add more than $40 billion in customer spending over the next several years.

The second is high bandwidth memory, the specialized chips that sit next to all AI accelerators and feed them data. Building HBM means stacking memory dies on top of each other and drilling tiny vertical connections through the silicon so the layers can talk. Lam is a leading provider of equipment for that step. Every HBM stack in every AI system passes through it, so the company gets paid on volume; it does not have to compete chip by chip.

The third piece is the one I find most interesting, because it changes what Lam's customers can do rather than just how much they can make. Its Aether process replaces the old method of spinning liquid chemicals onto a wafer with a dry process done in a vacuum. The result absorbs 3 to 5 times more EUV light and cuts the amount of chemical raw materials being used by 80% to 90%. One of the largest memory makers picked it as the production tool of record for its most advanced DRAM. Akara, Lam's newer etch platform, swaps in a solid-state plasma source that reacts to process changes more than 100 times faster than what came before, which matters when you are cutting features whose sizes are measured in atoms.

None of this shows up in a headline the way a new GPU does. But Lam's equipment is a key layer underneath chip technology, and it gets bought first.

The financial backdrop

The company closed its fiscal 2026 in June with record revenue of $23.2 billion and diluted earnings per share (EPS) of $5.82, up 41%. Gross margin for the quarter that ended in June hit 52%, the company's highest in 20 years, on pricing actions and favorable mix.

Management then raised its long-term targets by 500 to 1,000 basis points compared to the figures it provided during its 2025 investor day. It's now guiding for a gross margin in the mid-50% range and an operating margin in the mid-40% range. So, all in all, if the seasonal pattern holds again this year, Lam could be one of the more compelling chip stocks to own heading into the fall, especially with its underlying business momentum giving investors more than just history to lean on.

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Micah Zimmerman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Broadcom, Lam Research, and Nvidia. The Motley Fool has a disclosure policy.

If You Only Buy One Chip Stock This September, History Points to This One was originally published by The Motley Fool