Applied Materials, Inc. (NASDAQ:AMAT) is one of the AI Stocks on the Market’s Radar. On November 25, UBS upgraded the stock from Neutral to “Buy” and raised its price target to $285 from $250. Firm analysts see significant upside for AMAT driven by WFE growth and underappreciated China demand heading into 2026–2027. UBS’s holds a bullish outlook for the WFE market in 2026 and 2027. Its forecasts call for 2026 WFE to increase more than 20% year-over-year to $136.5 billion, largely driven by memory. It ant ...

Core Viewpoint - Applied Materials, Inc. (AMAT) is a leading player in the semiconductor equipment and materials industry, demonstrating strong financial performance and stock price appreciation, driven by the adoption of AI and investments in advanced semiconductor technologies [1][5]. Company Overview - Applied Materials, Inc. is based in Santa Clara, California, and provides manufacturing equipment, services, and software to the semiconductor and display industries, with a market capitalization of $184 billion [1][2]. - The company operates through three segments: Semiconductor Systems, Applied Global Services, and Display and Adjacent Markets [1]. Stock Performance - AMAT stock reached a 52-week high of $244.62 recently and has increased by 49.7% over the past three months, significantly outperforming the iShares Semiconductor ETF (SOXX), which gained 14.1% in the same period [3]. - Year-to-date, AMAT stock has risen by 49.1%, and over the past 52 weeks, it has increased by 38.9%, again surpassing SOXX's gains of 31.6% and 29.9%, respectively [4]. - The stock has consistently traded above its 50-day and 200-day moving averages since mid-September, indicating a bullish trend [4]. Financial Performance - For fiscal 2025, Applied Materials reported net revenues of $28.4 billion, reflecting a year-over-year increase of 4.4% [5]. - The adjusted earnings per share (EPS) rose by 8.9% year-over-year to $9.42, slightly exceeding consensus estimates [5]. Analyst Ratings - Among 34 analysts covering AMAT, the consensus rating is a "Moderate Buy," although the stock is currently trading above the mean price target of $239 [6].

Core Insights - Cullen Capital Management's SCCM Value Equity Strategy reported a gross return of 6.9% and a net return of 6.8% for Q3 2025, outperforming the Russell 1000 Value's 5.3% and underperforming the S&P 500's 8.1% during the same period [1] - Year-to-date, the strategy achieved a gross return of 13.0%, compared to Russell 1000 Value's +11.7% and S&P 500's +14.8% [1] Company Performance - Applied Materials, Inc. (NASDAQ:AMAT) showed a one-month return of 2.07% and a 52-week gain of 32.04%, closing at $225.12 per share with a market capitalization of $179.34 billion on November 18, 2025 [2] - The company reported better-than-expected fiscal Q3 results with a 12.2% increase, driven by strength in foundry, logic, and services, despite a moderation in demand from China [3] - Management guided for an 8% sequential revenue decline due to normalization in China and timing of leading-edge orders, but maintained a constructive outlook supported by AI-related semiconductor capital spending [3] Investment Sentiment - Applied Materials, Inc. was held by 81 hedge fund portfolios at the end of Q2 2025, a decrease from 83 in the previous quarter [4] - While the company is recognized for its potential, certain AI stocks are considered to offer greater upside potential with less downside risk [4]

Core Insights - Applied Materials, Inc. (AMAT) is valued at a market cap of $183.4 billion and provides essential manufacturing equipment, services, and software for semiconductor chips and advanced electronics [1] - The company plays a vital role in advancing technologies such as artificial intelligence, 5G, and electric vehicles by enhancing production processes for chipmakers and display manufacturers [1] Performance Overview - AMAT's shares have increased by 29.2% over the past 52 weeks, outperforming the S&P 500 Index, which gained 17.5% during the same period [2] - Year-to-date, AMAT's stock is up 48.1%, significantly higher than the S&P 500's 15.6% return [2] - Compared to the Invesco Semiconductors ETF (PSI), AMAT has outperformed with a YTD increase of 48.1% versus PSI's 34.5% [3] Financial Results - AMAT reported Q3 results on August 14, with revenue rising 7.7% year-over-year to $7.3 billion and adjusted EPS climbing 17% to $2.48, both exceeding consensus estimates [4] - Despite strong Q3 results, shares fell 14.1% in the next trading session due to disappointing Q4 guidance, with expected adjusted EPS of $2.11 and revenue of $6.7 billion, both below analyst expectations [4] Earnings Expectations - For the current fiscal year ending in October, analysts project AMAT's EPS to grow by 8.2% year-over-year to $9.36 [5] - The company has consistently surpassed consensus estimates in the last four quarters, indicating a strong earnings surprise history [5] Analyst Ratings - Among 35 analysts covering AMAT, the consensus rating is a "Moderate Buy," comprising 18 "Strong Buy," 3 "Moderate Buy," 13 "Hold," and 1 "Strong Sell" ratings [5] - The analyst sentiment has become slightly more bullish, with 17 analysts now suggesting a "Strong Buy" rating [6] - AllianceBernstein analyst Stacy Rasgon maintained a "Buy" rating on AMAT with a price target of $195 [6]

Core Insights - Applied Materials, Inc. (AMAT) is a leading supplier of manufacturing equipment, services, and software for the semiconductor and related industries, with a market cap of $182.2 billion [1] - The company is expected to announce its fiscal fourth-quarter earnings for 2025 soon, with analysts predicting a profit of $2.11 per share, a decrease of 9.1% from the previous year [2] - For the full fiscal year 2025, analysts forecast an EPS of $9.36, reflecting an 8.2% increase from $8.65 in fiscal 2024, with a slight rise to $9.42 expected in fiscal 2026 [3] Stock Performance - AMAT's stock has increased by 24.5% over the past 52 weeks, outperforming the S&P 500 Index's 16.9% gains but underperforming the Technology Select Sector SPDR Fund's 28.1% gains [4] - Following the release of better-than-expected Q3 results, AMAT's stock dropped by 14.1% due to disappointing Q4 guidance, despite revenue growth of 7.7% year over year to $7.3 billion [5] Analyst Ratings - The consensus opinion on AMAT stock is moderately bullish, with a "Moderate Buy" rating from 35 analysts; 18 recommend "Strong Buy," 3 suggest "Moderate Buy," 13 give a "Hold," and 1 recommends "Strong Sell" [6] - AMAT currently trades above its mean price target of $218.67, with a Street-high price target of $265 indicating a potential upside of 15.8% [6]

Core Viewpoint - Applied Materials, Inc. (NASDAQ:AMAT) is recognized as one of the best-performing stocks on NASDAQ, particularly among hedge funds, with a maintained Overweight rating and a price target of $225 from Cantor Fitzgerald [1][2]. Company Overview - Applied Materials develops and supplies manufacturing equipment, services, and software for the semiconductor, display, and related industries, operating across three main segments: Semiconductor Systems, Applied Global Services, and Display and Adjacent Markets [3]. Financial Impact and Estimates - Cantor Fitzgerald indicated that the financial impact of China-related concerns on Applied Materials is expected to be minor, estimating a 2% effect on fiscal year 2026 revenues. The earnings per share estimate for 2026 was slightly lowered from approximately $11.50 to $11.25 [1][2]. Industry Context - Other equipment companies may experience varied impacts from China-related regulatory concerns. For example, Lam Research is expected to face less disruption due to its existing exposure to embargoed Chinese memory makers, while ASML is anticipated to see very limited effects due to less stringent Dutch restrictions [2]. - China-related regulatory concerns are expected to remain a key focus for investors at the upcoming SEMICON West conference and during the earnings season [2].

Core Viewpoint - Applied Materials (AMAT) demonstrates strong operational performance and financial health, leading to a conclusion that the stock is fairly priced despite its high valuation [2][4]. Valuation - AMAT's valuation appears high compared to the broader market, indicating a need for careful evaluation [5]. Growth - The company has experienced moderate growth, with an average revenue growth rate of 4.4% over the past three years and a 6.6% increase in revenues from $27 billion to $29 billion over the last 12 months [6]. Profitability - AMAT's operating income for the last 12 months was $8.6 billion, resulting in an operating margin of 30.1%. The company generated nearly $7.7 billion in operating cash flow, with a cash flow margin of 26.9% and a net income of approximately $6.8 billion, reflecting a net margin of 23.9% [9]. Financial Stability - The company has a debt of $6.8 billion against a market capitalization of $176 billion, resulting in a debt-to-equity ratio of 3.8%. AMAT holds $7.0 billion in cash, which is 20.5% of its total assets of $34 billion [9]. Downturn Resilience - AMAT has historically underperformed compared to the S&P 500 during economic downturns, with significant declines observed during the 2022 inflation shock, the 2020 COVID pandemic, and the 2008 global financial crisis. The stock has shown a tendency to fully rebound to pre-crisis peaks after substantial declines [7][9].

Core Insights - Applied Materials (AMAT) is set to report its third-quarter fiscal 2025 results on August 14, with expected net sales of $7.2 billion, reflecting a 6.2% increase year-over-year [1] - The company projects non-GAAP earnings of $2.35 per share, indicating a 10.4% growth from the previous year [2] Financial Performance - The Zacks Consensus Estimate for revenues is also $7.2 billion, aligning with AMAT's expectations [1] - AMAT has a history of earnings surprises, with a 3.5% surprise in the last quarter and an average surprise of 4.9% over the past four quarters [3] Market Position and Demand - AMAT is well-positioned in advanced semiconductor manufacturing, particularly in AI, high-performance computing, and DRAM technologies [6][7] - The rising demand for advanced semiconductor chips, especially for AI-based data centers, is expected to positively impact the company's Q3 results [7] Challenges and Competition - U.S.-China trade tensions and a weak LCD market may pose challenges to AMAT's performance [9][10] - Competition from companies like KLA Corporation, Lam Research, and ASML Holdings is a concern for AMAT, particularly in the semiconductor supply chain market [17][19] Valuation and Investment Thesis - AMAT shares have increased by 13.6% year-to-date, underperforming the Zacks Electronics – Semiconductors industry, which has gained 19.7% [11] - The company is currently trading at a forward P/E of 18.79X, which is lower than the industry average of 25.55X, indicating a potential investment opportunity [14] - Despite near-term challenges, AMAT's strong fundamentals and favorable valuation suggest it is worth investing in [20]