Applied Materials (NASDAQ:AMAT) Shares Down 2.8% - Here's What Happened

Key Points

• Applied Materials shares fell 2.8% in Tuesday trading, with the stock last changing hands at $431.20 after trading as low as $416.56 on heavier-than-normal volume.
• Despite the pullback, Wall Street sentiment remains broadly positive: Cantor Fitzgerald raised its price target to $550 and reiterated an overweight rating, while the overall analyst consensus is still a Moderate Buy.
• The company continues to show supportive fundamentals and catalysts, including a higher quarterly dividend of $0.53 per share and a new partnership with TSMC aimed at accelerating AI scaling at the EPIC Center.

Applied Materials, Inc. (NASDAQ:AMAT - Get Free Report) shares fell 2.8% during mid-day trading on Tuesday . The stock traded as low as $416.56 and last traded at $431.20. 8,727,482 shares traded hands during trading, an increase of 21% from the average session volume of 7,222,709 shares. The stock had previously closed at $443.62.

Applied Materials News Summary

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

• Positive Sentiment: Cantor Fitzgerald raised its price target on Applied Materials to $550 from $500 and reiterated an overweight rating, signaling confidence in upside ahead of earnings. Applied Materials NASDAQ: AMAT Price Target Raised to $550.00 at Cantor Fitzgerald
• Positive Sentiment: Applied Materials announced a new partnership with TSMC at its EPIC Center to accelerate AI scaling, which could strengthen its role in next-generation semiconductor manufacturing and support longer-term demand. Applied Materials and TSMC Partner at the EPIC Center to Accelerate AI Scaling
• Positive Sentiment: Analysts and market commentary continue to highlight Applied Materials as a momentum stock, with AI-driven demand, HBM traction, and advanced packaging trends seen as supportive of near-term growth. AMAT to Post Q2 Earnings: Time to Buy, Sell or Hold the Stock?
• Positive Sentiment: Traders expect a potentially large post-earnings move, and some reports suggest the stock could reach new highs if results and guidance beat expectations. Here's How Much Traders Expect Applied Materials Stock to Move After Earnings
• Neutral Sentiment: Coverage ahead of the earnings release focused on Wall Street estimates and key operating metrics, keeping attention on whether Applied Materials can meet elevated expectations. Curious about Applied Materials (AMAT) Q2 Performance? Explore Wall Street Estimates for Key Metrics

Wall Street Analysts Forecast Growth

Several research firms have recently issued reports on AMAT. Zacks Research lowered Applied Materials from a "strong-buy" rating to a "hold" rating in a report on Monday, April 27th. Deutsche Bank Aktiengesellschaft reaffirmed a "buy" rating and issued a $450.00 price objective on shares of Applied Materials in a research note on Friday, February 13th. Erste Group Bank raised Applied Materials from a "hold" rating to a "buy" rating in a research note on Monday, April 27th. Cantor Fitzgerald raised their price objective on Applied Materials from $500.00 to $550.00 and gave the company an "overweight" rating in a research note on Monday. Finally, Needham & Company LLC raised their price objective on Applied Materials from $390.00 to $440.00 and gave the company a "buy" rating in a research note on Friday, February 13th. Twenty-eight equities research analysts have rated the stock with a Buy rating and seven have issued a Hold rating to the stock. Based on data from MarketBeat, the company has a consensus rating of "Moderate Buy" and a consensus price target of $384.52.

Applied Materials Stock Down 2.8%

The stock has a 50 day moving average price of $373.26 and a 200 day moving average price of $314.18. The stock has a market capitalization of $342.20 billion, a price-to-earnings ratio of 44.14, a price-to-earnings-growth ratio of 1.94 and a beta of 1.66. The company has a quick ratio of 1.94, a current ratio of 2.71 and a debt-to-equity ratio of 0.30.

Applied Materials (NASDAQ:AMAT - Get Free Report) last announced its quarterly earnings results on Thursday, February 12th. The manufacturing equipment provider reported $2.38 EPS for the quarter, beating analysts' consensus estimates of $2.21 by $0.17. Applied Materials had a return on equity of 37.52% and a net margin of 27.78%.The firm had revenue of $7.01 billion for the quarter, compared to analyst estimates of $6.88 billion. During the same period last year, the firm posted $2.38 earnings per share. The business's revenue for the quarter was down 2.1% on a year-over-year basis. Applied Materials has set its Q2 2026 guidance at 2.440-2.840 EPS. As a group, analysts forecast that Applied Materials, Inc. will post 11.14 EPS for the current year.

Applied Materials Increases Dividend

The company also recently declared a quarterly dividend, which will be paid on Thursday, June 11th. Stockholders of record on Thursday, May 21st will be paid a dividend of $0.53 per share. The ex-dividend date of this dividend is Thursday, May 21st. This is a positive change from Applied Materials's previous quarterly dividend of $0.46. This represents a $2.12 dividend on an annualized basis and a dividend yield of 0.5%. Applied Materials's payout ratio is 18.83%.

Insider Activity

In other news, CFO Brice Hill sold 5,000 shares of Applied Materials stock in a transaction dated Tuesday, February 17th. The stock was sold at an average price of $361.21, for a total transaction of $1,806,050.00. Following the sale, the chief financial officer directly owned 138,565 shares of the company's stock, valued at approximately $50,051,063.65. This trade represents a 3.48% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which can be accessed through the SEC website. Also, Director Judy Bruner sold 2,500 shares of the firm's stock in a transaction dated Wednesday, February 25th. The stock was sold at an average price of $391.71, for a total value of $979,275.00. Following the transaction, the director owned 26,089 shares of the company's stock, valued at $10,219,322.19. This trade represents a 8.74% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last three months, insiders have sold 12,003 shares of company stock valued at $4,484,189. 0.30% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Applied Materials

A number of hedge funds have recently made changes to their positions in AMAT. Cornerstone Financial Management LLC bought a new position in shares of Applied Materials during the fourth quarter worth about $25,000. Marquette Asset Management LLC raised its position in shares of Applied Materials by 150.0% during the third quarter. Marquette Asset Management LLC now owns 125 shares of the manufacturing equipment provider's stock worth $26,000 after acquiring an additional 75 shares during the last quarter. Redmont Wealth Advisors LLC bought a new position in shares of Applied Materials during the third quarter worth about $26,000. Wilkerson Advisory Group LLC bought a new position in shares of Applied Materials during the fourth quarter worth about $26,000. Finally, Financial Freedom LLC bought a new stake in Applied Materials in the first quarter worth approximately $28,000. 80.56% of the stock is currently owned by institutional investors.

Applied Materials Company Profile

Applied Materials, Inc is a U.S.-based supplier of equipment, services and software used to manufacture semiconductor chips, flat panel displays and other advanced materials. Headquartered in Santa Clara, California, the company designs and sells capital equipment and related technologies that enable production of integrated circuits, display panels and materials used across the electronics supply chain.

Applied Materials' offerings include process equipment and factory software that support critical steps in device fabrication, such as deposition, etch, implantation, inspection and metrology, as well as systems for packaging and advanced heterogeneous integration.

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