Applied Materials (AMAT) Registers a Bigger Fall Than the Market: Important Facts to Note

Company Performance - Applied Materials (AMAT) closed at $183.24, reflecting a -0.73% change from the previous day, underperforming the S&P 500 which had a daily loss of 0.02% [1] - Over the past month, AMAT shares have decreased by 0.83%, while the Computer and Technology sector gained 4.44% and the S&P 500 increased by 3.77% [1] - The upcoming earnings per share (EPS) for AMAT is projected at $2.18, indicating a 2.83% increase year-over-year, with quarterly revenue expected to be $6.94 billion, up 3.23% from the previous year [1] Annual Estimates - For the annual period, the Zacks Consensus Estimates predict earnings of $8.51 per share and revenue of $27.07 billion, representing increases of +5.71% and +2.09% respectively from the last year [2] Analyst Estimates and Valuation - Recent modifications to analyst estimates for AMAT are crucial as they reflect short-term business trends, with positive revisions indicating a favorable business outlook [2] - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), currently ranks AMAT at 3 (Hold), with the consensus EPS estimate remaining stagnant over the past month [3] - AMAT has a Forward P/E ratio of 21.68, which is a discount compared to the industry average Forward P/E of 27.9, and a PEG ratio of 2.39, compared to the industry average PEG ratio of 2.04 [3] Industry Context - The Semiconductor Equipment - Wafer Fabrication industry, part of the Computer and Technology sector, holds a Zacks Industry Rank of 105, placing it in the top 42% of over 250 industries [4] - The Zacks Industry Rank indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [4]