At $278.39, KLA (KLAC) is being priced to deliver 21.9% revenue growth annually for the next 6 years simply to defend today’s 78.0x multiple. That is a meaningful acceleration from the 13.4% the business is currently growing at. The multiple is asking for more than just continuity.

This is a growth acceleration year for KLA. The company sells critical process control equipment to semiconductor fabs building leading-edge foundry logic and high-bandwidth memory.

This demand surge is creating its own pressures, with elevated DRAM costs creating a persistent drag on gross margins. In response, management has sharply increased its capital return targets, backed by a new multi-billion-dollar buyback authorization.

With that as the…