Applied Materials (AMAT) Stock: Downgraded to Neutral as Competition Rises in China

Core Insights - Applied Materials, Inc. (AMAT) has been downgraded from Outperform to Neutral by Mizuho analyst Vijay Rakesh, with a new price target set at $175.00, down from $200.00 [1][4] Competitive Landscape - The firm highlights intensifying competition in China, which may negatively impact AMAT's market share, particularly in the Sputtering/PCVD segment where AMAT is heavily exposed [2][3] - AMAT is reportedly losing market share in key areas, with domestic Chinese suppliers like Naura and AMEC gaining ground [2][3] Revenue Exposure - Approximately 60% of AMAT's revenues are derived from PVD/Sputtering, Plasma CVD, and 28nm+ Conductor Etch, where it is experiencing a decline in market share [3] - In the Sputtering/PCVD segment, AMAT's revenue share is around 47%, while competitors like LAM Research Corporation (LRCX) are less exposed at approximately 15% [3] Market Dynamics - Chinese domestic OEMs are reportedly gaining 2-5 percentage points per year in PVD market share at the expense of AMAT, which is losing 2-4 percentage points [3] - In legacy 28nm etch nodes, Naura and AMEC are gaining approximately 2 percentage points from AMAT and LRCX [3]