Applied Materials (NASDAQ:AMAT) Shares Up 1.3% - Time to Buy?

Key Points

• Applied Materials shares rose 1.3% in mid-day trading, touching an intraday high of $440.50 as investors positioned ahead of Thursday’s earnings report.
• Analysts remain upbeat on AMAT, with several raising price targets on optimism around AI-driven semiconductor demand, strong DRAM/logic/foundry spending, and the company’s partnership with TSMC.
• Recent fundamentals were solid: Applied Materials beat fiscal Q1 earnings and revenue expectations, raised its quarterly dividend to $0.53 per share, and issued Q2 guidance above many expectations.

Applied Materials, Inc. (NASDAQ:AMAT - Get Free Report)'s share price traded up 1.3% during mid-day trading on Wednesday . The stock traded as high as $440.50 and last traded at $436.61. 6,979,900 shares were traded during trading, a decline of 3% from the average session volume of 7,197,516 shares. The stock had previously closed at $431.20.

Applied Materials News Summary

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

• Positive Sentiment: Applied Materials is expected to benefit from strong DRAM, logic, and foundry demand, with its AI-driven semiconductor systems business gaining traction ahead of Q2 results.
• Positive Sentiment: Analysts have raised price targets on AMAT, reflecting optimism tied to the AI chip boom and continued strength in semiconductor equipment spending.
• Positive Sentiment: The company announced a partnership with Taiwan Semiconductor Manufacturing Company to develop next-generation materials, equipment, and process technologies, which reinforces its role in AI chip manufacturing.
• Positive Sentiment: Commentary from Jim Cramer and others highlighted a broader shortage of semiconductor equipment, which could support demand for Applied Materials’ products.
• Neutral Sentiment: Investors are watching Thursday’s earnings closely, with some reports suggesting the stock could make a new high if results and guidance exceed expectations.
• Neutral Sentiment: Options and trading commentary show elevated interest ahead of the report, but that also means the shares may see a sharp post-earnings move in either direction.

Analyst Ratings Changes

A number of analysts have weighed in on AMAT shares. Sanford C. Bernstein restated an "outperform" rating and issued a $425.00 price target on shares of Applied Materials in a research note on Friday, February 13th. Wells Fargo & Company upped their price objective on Applied Materials from $350.00 to $435.00 and gave the stock an "overweight" rating in a research report on Friday, February 13th. Stifel Nicolaus increased their price objective on Applied Materials from $340.00 to $450.00 and gave the company a "buy" rating in a report on Friday, February 13th. Bank of America raised their target price on Applied Materials from $300.00 to $350.00 and gave the stock a "buy" rating in a research report on Tuesday, January 13th. Finally, Summit Insights upgraded Applied Materials from a "hold" rating to 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 assigned a Hold rating to the company. Based on data from MarketBeat.com, the company currently has a consensus rating of "Moderate Buy" and an average target price of $384.52.

Applied Materials Stock Up 1.3%

The stock has a market cap of $346.50 billion, a PE ratio of 44.69, a P/E/G ratio of 1.97 and a beta of 1.66. The business has a 50 day moving average of $374.44 and a 200-day moving average of $315.66. The company has a current ratio of 2.71, a quick ratio of 1.94 and a debt-to-equity ratio of 0.30.

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

Applied Materials Increases Dividend

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

Insiders Place Their Bets

In other Applied Materials news, CFO Brice Hill sold 5,000 shares of Applied Materials stock in a transaction on Tuesday, February 17th. The shares were sold at an average price of $361.21, for a total value of $1,806,050.00. Following the transaction, the chief financial officer directly owned 138,565 shares in the company, valued at approximately $50,051,063.65. The trade was a 3.48% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, Director Judy Bruner sold 3,969 shares of the stock in a transaction dated Monday, February 23rd. The stock was sold at an average price of $377.02, for a total transaction of $1,496,392.38. Following the sale, the director owned 28,589 shares of the company's stock, valued at $10,778,624.78. This trade represents a 12.19% decrease in their position. The disclosure for this sale is available in the SEC filing. In the last three months, insiders have sold 12,003 shares of company stock valued at $4,484,189. Insiders own 0.30% of the company's stock.

Institutional Trading of Applied Materials

A number of hedge funds have recently added to or reduced their stakes in AMAT. Brighton Jones LLC raised its position in Applied Materials by 28.0% during the 4th quarter. Brighton Jones LLC now owns 12,674 shares of the manufacturing equipment provider's stock worth $2,061,000 after buying an additional 2,771 shares during the last quarter. Sivia Capital Partners LLC boosted its holdings in shares of Applied Materials by 26.7% in the second quarter. Sivia Capital Partners LLC now owns 3,225 shares of the manufacturing equipment provider's stock valued at $590,000 after acquiring an additional 679 shares in the last quarter. Forefront Wealth Partners LLC acquired a new position in shares of Applied Materials during the second quarter worth about $410,000. Schnieders Capital Management LLC. raised its holdings in Applied Materials by 30.1% during the second quarter. Schnieders Capital Management LLC. now owns 15,003 shares of the manufacturing equipment provider's stock worth $2,747,000 after purchasing an additional 3,469 shares in the last quarter. Finally, Sei Investments Co. raised its holdings in Applied Materials by 59.3% during the second quarter. Sei Investments Co. now owns 422,694 shares of the manufacturing equipment provider's stock worth $77,383,000 after purchasing an additional 157,426 shares in the last quarter. 80.56% of the stock is owned by institutional investors and hedge funds.

About Applied Materials

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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