Applied Materials (NASDAQ:AMAT) Trading Down 13.6% Following Analyst Downgrade

Key Points

• Applied Materials shares fell by 13.6% after UBS downgraded the stock's price target from $185 to $180 while maintaining a neutral rating.
• Despite the downgrade, other brokerages, including Citigroup and JPMorgan, have raised their price targets and assigned buy or overweight ratings.
• Insider trading activity revealed that CAO Adam Sanders sold 562 shares, indicating a decrease in his holdings by 9.59%.

Applied Materials, Inc. (NASDAQ:AMAT - Get Free Report)'s stock price fell 13.6% during mid-day trading on Friday after Deutsche Bank Aktiengesellschaft lowered their price target on the stock from $200.00 to $170.00. Deutsche Bank Aktiengesellschaft currently has a hold rating on the stock. Applied Materials traded as low as $162.50 and last traded at $162.72. 14,805,559 shares traded hands during trading, an increase of 103% from the average session volume of 7,279,006 shares. The stock had previously closed at $188.24.

Several other analysts have also recently issued reports on the company. Cantor Fitzgerald reduced their price objective on Applied Materials from $220.00 to $200.00 and set an "overweight" rating on the stock in a research note on Friday. UBS Group dropped their price target on shares of Applied Materials from $185.00 to $180.00 and set a "neutral" rating on the stock in a research note on Friday. B. Riley reduced their price target on shares of Applied Materials from $250.00 to $215.00 and set a "buy" rating on the stock in a report on Monday, May 12th. Mizuho reduced their price objective on shares of Applied Materials from $220.00 to $200.00 and set an "outperform" rating on the stock in a research note on Friday. Finally, Barclays increased their price objective on shares of Applied Materials from $160.00 to $170.00 and gave the stock an "equal weight" rating in a research report on Monday, July 28th. One investment analyst has rated the stock with a sell rating, eleven have issued a hold rating and seventeen have issued a buy rating to the stock. Based on data from MarketBeat, the stock has a consensus rating of "Moderate Buy" and an average target price of $194.84.

Insiders Place Their Bets

In related news, CAO Adam Sanders sold 562 shares of Applied Materials stock in a transaction that occurred on Tuesday, June 24th. The shares were sold at an average price of $178.60, for a total transaction of $100,373.20. Following the sale, the chief accounting officer directly owned 5,300 shares of the company's stock, valued at approximately $946,580. The trade was a 9.59% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through this hyperlink. 0.24% of the stock is owned by company insiders.

Institutional Trading of Applied Materials

Institutional investors and hedge funds have recently made changes to their positions in the company. Shelton Wealth Management LLC grew its stake in shares of Applied Materials by 1.5% in the second quarter. Shelton Wealth Management LLC now owns 3,398 shares of the manufacturing equipment provider's stock worth $622,000 after acquiring an additional 51 shares during the period. Octavia Wealth Advisors LLC grew its holdings in Applied Materials by 0.8% during the 2nd quarter. Octavia Wealth Advisors LLC now owns 6,200 shares of the manufacturing equipment provider's stock worth $1,135,000 after acquiring an additional 51 shares in the last quarter. Narus Financial Partners LLC boosted its stake in Applied Materials by 3.8% in the 2nd quarter. Narus Financial Partners LLC now owns 1,433 shares of the manufacturing equipment provider's stock worth $262,000 after purchasing an additional 52 shares in the last quarter. AdvisorNet Financial Inc lifted its stake in Applied Materials by 2.7% during the 2nd quarter. AdvisorNet Financial Inc now owns 1,958 shares of the manufacturing equipment provider's stock valued at $358,000 after acquiring an additional 52 shares during the period. Finally, Encompass Wealth Advisors LLC increased its holdings in Applied Materials by 3.4% in the 2nd quarter. Encompass Wealth Advisors LLC now owns 1,601 shares of the manufacturing equipment provider's stock worth $293,000 after acquiring an additional 53 shares in the last quarter. Hedge funds and other institutional investors own 80.56% of the company's stock.

Applied Materials Stock Performance

The company has a current ratio of 2.46, a quick ratio of 1.76 and a debt-to-equity ratio of 0.29. The firm's fifty day moving average is $184.18 and its 200 day moving average is $166.54. The company has a market cap of $129.81 billion, a PE ratio of 19.28, a price-to-earnings-growth ratio of 1.81 and a beta of 1.70.

Applied Materials (NASDAQ:AMAT - Get Free Report) last issued its quarterly earnings results on Thursday, August 14th. The manufacturing equipment provider reported $2.48 earnings per share for the quarter, topping the consensus estimate of $2.36 by $0.12. The firm had revenue of $7.30 billion during the quarter, compared to the consensus estimate of $7.21 billion. Applied Materials had a return on equity of 41.31% and a net margin of 23.88%. The company's revenue for the quarter was up 7.7% on a year-over-year basis. During the same period last year, the company earned $2.12 earnings per share. As a group, research analysts predict that Applied Materials, Inc. will post 9.38 EPS for the current fiscal year.

Applied Materials Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Thursday, September 11th. Investors of record on Thursday, August 21st will be paid a dividend of $0.46 per share. The ex-dividend date of this dividend is Thursday, August 21st. This represents a $1.84 annualized dividend and a yield of 1.1%. Applied Materials's dividend payout ratio (DPR) is currently 21.93%.

Applied Materials Company Profile

Applied Materials, Inc engages in the provision of manufacturing equipment, services, and software to the semiconductor, display, and related industries. The company operates through three segments: Semiconductor Systems, Applied Global Services, and Display and Adjacent Markets. The Semiconductor Systems segment develops, manufactures, and sells various manufacturing equipment that is used to fabricate semiconductor chips or integrated circuits.