Applied Materials (NASDAQ:AMAT) Shares Up 8.6% - Time to Buy?

Key Points

• Applied Materials shares jumped 8.6% on Monday, with trading volume running above average as investors reacted to upbeat sector sentiment and recent AI-driven chip equipment demand commentary.
• Several analysts raised price targets on AMAT, including TD Cowen, Wells Fargo, Bank of America and Truist, reinforcing a broadly bullish Wall Street view despite some concern that the stock may be getting expensive after its big run.
• The company recently beat earnings and revenue expectations, posted 11.4% year-over-year quarterly revenue growth, and increased its quarterly dividend to $0.53 per share, though insider selling has added a cautious note.

Applied Materials, Inc. (NASDAQ:AMAT - Get Free Report)'s stock price traded up 8.6% on Monday . The company traded as high as $497.71 and last traded at $492.17. 9,606,172 shares changed hands during mid-day trading, an increase of 29% from the average session volume of 7,425,270 shares. The stock had previously closed at $453.01.

Applied Materials News Roundup

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

• Positive Sentiment: Applied Materials is being viewed as a key beneficiary of AI-related chip factory spending, with recent commentary citing strong demand across logic, memory and packaging, plus upbeat Wall Street notes and price-target increases. Applied Materials jumps 6.8% as AI-driven equipment demand and analyst optimism lift shares
• Positive Sentiment: Citi’s latest semiconductor note said the recent pullback in chip stocks looks healthy, reinforcing a constructive view on the sector and supporting sentiment for AMAT alongside other equipment names. 3 chip stocks to buy after recent SOX pullback: Citi
• Neutral Sentiment: New articles questioned whether AMAT is still a buy after its 167% one-year surge, suggesting valuation may be getting stretched even as business momentum remains strong. Should You Buy, Sell or Hold AMAT Stock After a 167% Rise in a Year?
• Neutral Sentiment: Coverage comparing AMAT’s performance with other computer and technology stocks this year was mainly a relative-performance update, with no new fundamental catalyst. Are Computer and Technology Stocks Lagging Applied Materials (AMAT) This Year?
• Negative Sentiment: Some bearish signals are showing up in the background, including a reported CFO stock sale and ongoing insider selling, which could temper enthusiasm if investors focus on valuation and insider activity. Insider Selling: Applied Materials NASDAQ: AMAT CFO Sells $1,247,150.00 in Stock

Wall Street Analysts Forecast Growth

Several research firms have recently weighed in on AMAT. TD Cowen upped their target price on shares of Applied Materials from $450.00 to $525.00 and gave the stock a "buy" rating in a report on Friday, May 15th. Wells Fargo & Company upped their price objective on shares of Applied Materials from $435.00 to $520.00 and gave the stock an "overweight" rating in a research note on Friday, May 15th. Susquehanna lifted their target price on shares of Applied Materials from $435.00 to $500.00 and gave the company a "positive" rating in a research note on Thursday, April 9th. Bank of America raised their price target on Applied Materials from $465.00 to $540.00 and gave the company a "buy" rating in a report on Friday, May 15th. Finally, Truist Financial set a $575.00 price objective on Applied Materials in a research report on Thursday, May 28th. Twenty-seven investment analysts have rated the stock with a Buy rating and eight have assigned a Hold rating to the stock. Based on data from MarketBeat, the company presently has an average rating of "Moderate Buy" and an average price target of $470.13.

Applied Materials Stock Up 8.6%

The firm's 50-day moving average is $408.94 and its two-hundred day moving average is $343.11. The company has a debt-to-equity ratio of 0.22, a quick ratio of 1.80 and a current ratio of 2.51. The stock has a market cap of $390.76 billion, a P/E ratio of 46.21, a PEG ratio of 1.27 and a beta of 1.67.

Applied Materials (NASDAQ:AMAT - Get Free Report) last announced its quarterly earnings data on Thursday, May 14th. The manufacturing equipment provider reported $2.86 EPS for the quarter, beating analysts' consensus estimates of $2.68 by $0.18. The firm had revenue of $7.91 billion for the quarter, compared to analyst estimates of $7.68 billion. Applied Materials had a return on equity of 36.97% and a net margin of 29.31%.The business's quarterly revenue was up 11.4% compared to the same quarter last year. During the same period last year, the company earned $2.39 EPS. Applied Materials has set its Q3 2026 guidance at 3.160-3.560 EPS. On average, equities research analysts anticipate that Applied Materials, Inc. will post 12.02 earnings per share for the current year.

Applied Materials Increases Dividend

The firm also recently announced a quarterly dividend, which will be paid on Thursday, June 11th. Shareholders of record on Thursday, May 21st will be issued a dividend of $0.53 per share. The ex-dividend date of this dividend is Thursday, May 21st. This represents a $2.12 dividend on an annualized basis and a yield of 0.4%. This is a boost from Applied Materials's previous quarterly dividend of $0.46. Applied Materials's dividend payout ratio (DPR) is presently 19.91%.

Insider Buying and Selling

In other Applied Materials news, CAO Adam Sanders sold 268 shares of the stock in a transaction on Friday, May 22nd. The shares were sold at an average price of $434.22, for a total value of $116,370.96. Following the sale, the chief accounting officer directly owned 4,280 shares in the company, valued at approximately $1,858,461.60. This trade represents a 5.89% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is accessible through the SEC website. Also, insider Prabu G. Raja sold 50,000 shares of the business's stock in a transaction on Thursday, June 4th. The shares were sold at an average price of $505.28, for a total transaction of $25,264,000.00. Following the completion of the transaction, the insider directly owned 356,642 shares of the company's stock, valued at $180,204,069.76. This trade represents a 12.30% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Over the last three months, insiders sold 53,896 shares of company stock worth $27,135,121. Corporate insiders own 0.30% of the company's stock.

Institutional Trading of Applied Materials

A number of large investors have recently bought and sold shares of the business. Vanguard Group Inc. raised its holdings in shares of Applied Materials by 0.4% during the fourth quarter. Vanguard Group Inc. now owns 76,779,340 shares of the manufacturing equipment provider's stock worth $19,731,523,000 after acquiring an additional 330,197 shares during the period. Capital Research Global Investors raised its stake in shares of Applied Materials by 119.8% in the 4th quarter. Capital Research Global Investors now owns 32,707,049 shares of the manufacturing equipment provider's stock valued at $8,405,458,000 after purchasing an additional 17,829,377 shares during the period. Ameriprise Financial Inc. lifted its holdings in shares of Applied Materials by 40.1% in the third quarter. Ameriprise Financial Inc. now owns 12,520,114 shares of the manufacturing equipment provider's stock valued at $2,563,376,000 after purchasing an additional 3,583,751 shares in the last quarter. Morgan Stanley boosted its position in shares of Applied Materials by 3.4% during the fourth quarter. Morgan Stanley now owns 11,470,835 shares of the manufacturing equipment provider's stock worth $2,947,891,000 after buying an additional 373,012 shares during the period. Finally, Norges Bank bought a new position in shares of Applied Materials during the fourth quarter worth about $2,858,543,000. 80.56% of the stock is 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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