Royal Bank Of Canada Reaffirms Outperform Rating for Applied Materials (NASDAQ:AMAT)

Key Points

• Royal Bank of Canada reaffirmed its “Outperform” rating on Applied Materials and set a $600 price target, implying 32.58% upside from the prior close.
• Analyst sentiment remains favorable, with a consensus “Moderate Buy” rating and average price target of $640.20; targets from other firms range as high as $850.
• Applied Materials exceeded quarterly earnings and revenue expectations, reporting $3.50 EPS and $9.12 billion in revenue, while revenue rose 24.8% year over year.

Applied Materials (NASDAQ:AMAT - Get Free Report)'s stock had its "outperform" rating reaffirmed by stock analysts at Royal Bank Of Canada in a note issued to investors on Wednesday, Benzinga reports. They currently have a $600.00 target price on the manufacturing equipment provider's stock. Royal Bank Of Canada's price objective would indicate a potential upside of 32.58% from the stock's previous close.

A number of other equities research analysts have also recently weighed in on the stock. JPMorgan Chase & Co. upped their price objective on shares of Applied Materials from $515.00 to $660.00 and gave the stock an "overweight" rating in a report on Friday, August 14th. UBS Group increased their price target on shares of Applied Materials from $675.00 to $695.00 and gave the company a "buy" rating in a report on Tuesday, September 1st. HC Wainwright set a $850.00 price target on shares of Applied Materials in a report on Monday, June 29th. Wall Street Zen upgraded shares of Applied Materials from a "hold" rating to a "buy" rating in a report on Saturday, September 26th. Finally, TD Cowen restated a "buy" rating and set a $700.00 price objective on shares of Applied Materials in a research report on Friday, August 14th. One investment analyst has rated the stock with a Strong Buy rating, thirty have given a Buy rating and eight have assigned a Hold rating to the stock. Based on data from MarketBeat.com, Applied Materials presently has a consensus rating of "Moderate Buy" and an average target price of $640.20.

Applied Materials Price Performance

AMAT stock opened at $452.56 on Wednesday. The firm's 50-day moving average price is $486.82 and its two-hundred day moving average price is $484.20. Applied Materials has a 12-month low of $203.40 and a 12-month high of $739.67. The stock has a market capitalization of $359.15 billion, a price-to-earnings ratio of 39.02, a PEG ratio of 1.38 and a beta of 1.60. The company has a current ratio of 2.42, a quick ratio of 1.79 and a debt-to-equity ratio of 0.20.

Applied Materials (NASDAQ:AMAT - Get Free Report) last announced its quarterly earnings results on Thursday, August 13th. The manufacturing equipment provider reported $3.50 earnings per share (EPS) for the quarter, beating the consensus estimate of $3.40 by $0.10. Applied Materials had a net margin of 30.05% and a return on equity of 38.02%. The company had revenue of $9.12 billion for the quarter, compared to analysts' expectations of $8.99 billion. During the same quarter in the previous year, the company earned $2.48 earnings per share. Applied Materials's quarterly revenue was up 24.8% on a year-over-year basis. Applied Materials has set its Q4 2026 guidance at 3.820-4.220 EPS. As a group, equities analysts predict that Applied Materials will post 12.79 earnings per share for the current year.

Insider Activity

In other news, CAO Adam Sanders sold 725 shares of the firm's stock in a transaction on Friday, October 2nd. The shares were sold at an average price of $544.56, for a total transaction of $394,806.00. Following the sale, the chief accounting officer directly owned 3,181 shares in the company, valued at $1,732,245.36. This trade represents a 18.56% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CFO Brice Hill sold 7,500 shares of the firm's stock in a transaction on Tuesday, August 25th. The shares were sold at an average price of $479.25, for a total transaction of $3,594,375.00. Following the sale, the chief financial officer owned 128,613 shares in the company, valued at $61,637,780.25. The trade was a 5.51% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold 9,225 shares of company stock worth $4,454,181 in the last three months. Company insiders own 0.30% of the company's stock.

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently modified their holdings of the business. BlackRock Inc. lifted its stake in Applied Materials by 1.6% during the second quarter. BlackRock Inc. now owns 80,212,518 shares of the manufacturing equipment provider's stock valued at $57,993,650,000 after buying an additional 1,237,685 shares in the last quarter. State Street Corp lifted its stake in Applied Materials by 85.4% during the second quarter. State Street Corp now owns 69,525,842 shares of the manufacturing equipment provider's stock valued at $50,267,184,000 after buying an additional 32,018,892 shares in the last quarter. Amundi lifted its stake in Applied Materials by 19.0% during the second quarter. Amundi now owns 7,808,207 shares of the manufacturing equipment provider's stock valued at $5,645,344,000 after buying an additional 1,246,876 shares in the last quarter. Van ECK Associates Corp lifted its stake in Applied Materials by 16.2% during the second quarter. Van ECK Associates Corp now owns 7,713,599 shares of the manufacturing equipment provider's stock valued at $5,576,932,000 after buying an additional 1,073,879 shares in the last quarter. Finally, Bank of America Corp DE purchased a new stake in Applied Materials during the second quarter valued at about $5,252,863,000. 80.56% of the stock is owned by hedge funds and other institutional investors.

Key Headlines Impacting Applied Materials

Here are the key news stories impacting Applied Materials this week:

• Positive Sentiment: Strong earnings record and analyst optimism: Applied Materials has delivered its fifth consecutive earnings beat, while Cantor Fitzgerald maintained an $850 price target, implying substantial potential upside from recent levels. Another Wall Street analysis characterized the recent selloff as a potential disconnect between operating performance and valuation. Applied Materials Could Nearly Double Within 12 Months Cantor Fitzgerald Maintains Applied Materials Price Target
• Positive Sentiment: AI investment and EPIC research center: The company unveiled its planned $5 billion EPIC Center in Silicon Valley, bringing together chipmakers including Intel, Micron, SK Hynix and Samsung to accelerate semiconductor process and equipment development. Applied Ventures also invested in Flexcompute’s physics-focused AI platform, aimed at speeding chip design and materials research. Applied Materials Unveils EPIC Center Applied Materials Invests in Flexcompute
• Positive Sentiment: Long-term growth opportunities: Investor-day materials highlighted expected gains in optical inspection, eBeam equipment and semiconductor services, supported by continued AI-related wafer-fabrication demand and partnerships with leading chip manufacturers. Applied Materials Long-Term Growth Presentation
• Neutral Sentiment: Valuation remains a key debate: AMAT trades at a premium earnings multiple, so investors are demanding evidence that future growth will justify the valuation. Erste Group modestly raised its FY2027 EPS estimate but retained a “Hold” rating. Applied Materials Valuation and Growth Analysis
• Negative Sentiment: Investor-day guidance disappointed: The stock faced renewed selling after Applied Materials provided what some investors viewed as uncertain 2030 guidance and did not fully quantify the long-term payoff from its initiatives. The shares also approached an important technical support level. Why Applied Materials Sank
• Negative Sentiment: Semiconductor-sector selling pressure: Investors took profits after a strong year for AI-linked chip stocks. A sharp decline in South Korea’s KOSPI and broader technology weakness intensified pressure on Applied Materials, Lam Research and KLA. Semiconductor Equipment Stocks Sell Off

About Applied Materials

Applied Materials, Inc is a global supplier of equipment, services and software used to manufacture semiconductor chips, flat-panel displays and other advanced electronic products. Its technologies help customers build and enhance materials at the nanoscale, supporting processes such as deposition, etching, inspection, metrology and packaging.

The company's offerings include semiconductor manufacturing systems, process-control and inspection equipment, and services designed to improve the performance, productivity and longevity of production equipment.