KLA Corporation stock surged about 9.5% in morning trade after TD Cowen increased its price objective for the semiconductor equipment company to $260 from $200. The brokerage also published a high-conviction thesis that forecasts global wafer fab equipment spending could expand to $250 billion by 2028 and might reach $400 billion by 2030.
TD Cowen’s note attributed the potential WFE expansion to several factors specified in the research: rising demand for AI-related chips, improved returns on investment for memory processing lines, and take-or-pay supply arrangements that secure long-term customer commitments. Under the $250 billion WFE case, the firm modeled KLA earnings per share in the $9 to $10 range, and it projected additional upside under the $400 billion scenario.
The analyst upgrade arrived against a backdrop that amplified its impact. KLAC had declined over the previous two sessions after Samsung’s Q2 earnings report prompted a broad premarket selloff among chip-equipment stocks on July 7. Market sentiment was further pressured by a separate disclosure that CFO Bren Higgins sold approximately 27,700 shares earlier in the month.
Because the shares had pulled back substantially from recent highs, the Cowen research provided a clear catalyst for a technical rebound. Traders also noted the proximity of KLA’s fiscal Q4 2026 earnings announcement, scheduled for July 23, with Wall Street generally expecting continued adjusted EPS growth and revenue in the vicinity of $3.575 billion.
The broader market offered only a modest lift on the session - the S&P 500 was up 0.3% and the Nasdaq also rose 0.3% - gains that were small relative to KLA’s near-10% jump, indicating the move was largely company- and sector-specific. TD Cowen raised price targets for peer equipment manufacturers Applied Materials and Lam Research in the same research wave, helping to buoy the semiconductor equipment group and strengthen the sympathy bid for KLAC.
In intraday action, shares of KLA reached a session high of $247.49 before settling near $242, marking one of the larger single-session gains for the stock in recent months. Taken together, the analyst-driven projection of a multi-year WFE cycle, a technically oversold setup following last week’s selloff, and rising pre-earnings optimism ahead of the July 23 report combined to produce materially higher trading in the name.
Summary
TD Cowen’s higher price target and bullish WFE scenarios, coupled with a technical rebound and earnings-season momentum, drove a substantial intraday rise in KLA shares. The research note specified potential industry spending trajectories and modeled outsized EPS outcomes under those scenarios.