Investing.com -- Barclays lifted its wafer fabrication equipment estimates and raised price targets on Applied Materials, KLA Corporation, and Lam Research in a note on Wednesday.

The bank projects the WFE market will surpass $200 billion in 2027 as the semiconductor capex cycle strengthens across the board.

Analyst Tom O'Malley raised his 2027 WFE estimate to $209.5 billion from $159 billion, well above the Street-implied figure of $172 billion, driven by significantly stronger DRAM, NAND, and foundry/logic spending.

DRAM is now forecast to grow 115% year-over-year in 2026 and 40% in 2027, while NAND estimates were raised sharply to 60% growth in 2027 from a prior 10%. Leading edge is projected to grow 50% in 2027, supported by continued investment at TSMC, Samsung, and Intel.

The Applied Materials price target was increased to $590 from $500, implying roughly 18% upside. The firm lifted its 2027 EPS estimate for AMAT to $20.23 from $17.13.

KLA's target was raised to $2,250 from $1,700, and 2027 EPS was raised to $74.53 from $55.96.

Lam Research's target was lifted to $335 from $275, roughly in line with where the stock trades today, with 2027 EPS raised to $10.47 from $8.55.

Barclays noted that when looking at valuation, "it's clear that '28 is already contemplated in these names," suggesting the market has moved ahead of the current estimate cycle.